Exhibit 15 - Rebuttal Report of Feinstein dated Aug. 9, 2024 — Marshall v. Prestamos CDFI, LLC (Dkt. 139-16, E.D. Pa. No. 5:21-cv-04337)

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U.S. District Court for the Eastern District of Pennsylvania · No. 5:21-cv-04337-JMG · Doc. 139-16 · 2024-09-06 · Docket on CourtListener

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EX. 15 -- THE REBUTTAL REPORT OF 
FEINSTEIN DATED AUG. 9, 2024 
Case 5:21-cv-04337-JMG     Document 139-16     Filed 09/06/24     Page 1 of 7

IN THE UNITED STATES DISTRICT COURT 
FOR THE EASTERN DISTRICT OF PENNSYLVANIA 
ALICIA MARSHALL, et al., individually 
and on behalf of all others similarly situated, 
Plaintiffs, 
v. 
PRESTAMOS CDFI, LLC, 
 Defendant. 
Civil Action No. 5:21-cv-04337-JMG 
REBUTTAL REPORT OF 
PROFESSOR STEVEN P. FEINSTEIN, PH.D., CFA 
August 9, 2024 
Case 5:21-cv-04337-JMG     Document 139-16     Filed 09/06/24     Page 2 of 7

TABLE OF CONTENTS 
I.
SCOPE OF ANALYSIS AND REPORT ............................................................................. 1 
II.
SUMMARY OF THE SWAIN REPORT AND OPINIONS .............................................. 1 
III.
ANALYSIS, CONCLUSIONS, AND OPINIONS ............................................................. 2 
IV.
LIMITING FACTORS AND OTHER ASSUMPTIONS .................................................... 3 
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I.
SCOPE OF ANALYSIS AND REPORT
1.
On July 12, 2024, I submitted an opening report addressing and describing a damages
methodology for computing damages in this matter (the “Feinstein Report”). Based on my
analysis, research, and case document review, I concluded that assuming Plaintiffs’ factual
allegations, damages that are consistent with Plaintiffs’ theory of liability can be computed
using a common methodology for all Class members.1
2.
In the Feinstein Report, I explained that damages for each Class member can be measured as
the difference between the SBA-approved PPP loan amount and the amount that the Class
member received, plus prejudgment interest.2 I determined that this is a feasible, and
Class-wide common methodology, which provides a conservative measure of economic
damages suffered by each Class member.3
3.
I am now asked by Bailey & Glasser LLP, co-counsel for the Plaintiffs, to consider, evaluate,
and respond to the arguments and conclusions in the proposed Expert Report of Kenneth
Swain, dated July 12, 2024 (the “Swain Report”), which was submitted by the Defendant in
this matter. This rebuttal report presents my response to certain issues raised in the Swain
Report. I do not purport to address all of the issues set forth in the Swain Report.
4.
I reviewed and relied upon all the data and documents listed in the Feinstein Report. My
credentials and compensation are presented in the Feinstein Report, as is a list of testimony I
provided during the four years preceding that report. Testimony I have provided since the
Feinstein Report is identified in Exhibit-1 of this report.
5.
My work in this matter is ongoing. I reserve the right to amend, refine, or supplement my
analyses and opinions in the event that I become aware of additional information, evidence,
arguments, or analyses that bear on my work in this matter, and if and as the Court may permit.
II.
SUMMARY OF THE SWAIN REPORT AND OPINIONS
6.
Mr. Swain was asked to: “(a) provide an overview” and certain details about the “PPP lending
program;” “(b) assess the reasons why the Putative Class Members did not receive PPP loan
1 Feinstein Report, ¶22. 
2 Feinstein Report, ¶23. 
3 Feinstein Report, ¶23. 
1
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funds;” and (c) “assess the reasons why the Putative Class Members’ PPP loans may not have 
been fully forgiven.”4 
7.
Mr. Swain opines that establishing why Class members did not receive their PPP funds would
purportedly require “individualized” inquiry for each Class member. He also contends that
individual inquiry would be necessary to determine if and why a Class member might not
have had their PPP loan forgiven in the hypothetical counterfactual scenario where they would
have received their PPP funds. He repeatedly refers in his July 12, 2024, report to the term
“individualized”; see Swain Report, ¶¶15-16, 27 (twice), 35, 38-39, 52-53, 78, 86, 88.
III.
ANALYSIS, CONCLUSIONS, AND OPINIONS
8.
A fatal flaw in Mr. Swain’s analysis and report, as it relates to the computation of damages,
is that he does not assume Plaintiffs will be able to prove their factual allegations and liability.
It is my understanding that a damages expert must assume that liability will be proven on the
merits.5 Mr. Swain does not do so, and consequently his opinion does not at all address the
computation of damages consistent with Plaintiffs’ theory of liability. In fact, Mr. Swain does
not address damages at all in his opening report.
9.
Mr. Swain argues that there could be several reasons why a Class member’s PPP loan was
not funded. He offers that one would therefore need to perform an “individualized” analysis
to establish liability. Mr. Swain does not accept, even as a working assumption, Plaintiffs’
allegations that Prestamos breached its contractual undertaking by failing to fund the
SBA-approved PPP loans and thereby impeded Plaintiffs from accessing the funds of the PPP
loan program.6 With his argument, Mr. Swain is challenging the merits of the case, not the
ability to compute damages commonly assuming liability is established.
10.
As Mr. Swain does not address damages under the assumption that Plaintiffs are able to prove
liability, and because I continue to believe my opinions and analysis in my opening report are
sound, nothing in the Swain Report causes me to change my conclusions.
4 Swain Report, ¶10. 
5 Feinstein Report, ¶38; See, e.g., “Reference Guide on Estimation of Economic Damages,” by Mark A. Allen et al., 
Reference Manual on Scientific Evidence, 3rd Edition, 2011, p. 432 (“In almost all cases, the damages expert proceeds on 
the hypothesis that the defendant committed the harmful act and that the act was unlawful.”). 
6 Feinstein Report, ¶6; and Plaintiffs’ Third Amended Complaint, ¶¶431, 435. 
2
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11.
Mr. Swain further asserts that if Class members had received their PPP funds, the “final
portion of the loan amount to be forgiven would have varied widely.”” Loans would not be
forgiven ifthe funds were misused. Mr. Swain argues that loan forgiveness therefore requires
individualized inquiry. With this argument, Mr. Swain again inappropriately rejects Plaintiffs’
factual allegations and theory of liability, in particular, the fact that Class members never
received the PPP funds.
Consistent with Plaintiffs’ factual allegations, Plaintiffs’ theory of liability, and the rules and
experience ofthe PPP, no individualized inquiry is necessary to assess the appropriate use of
PPP funds and thus loan forgiveness in the computation of damages. This is because, by
definition ofthe classes alleged in this case, Class members could not properly seek or obtain
loan forgiveness under the PPP on loan proceeds they never received.
Mr. Swain’s arguments are either about the legal liability merits ofthis case, or stem from his
questioning of the merits. They do not address the computation of damages under the
assumption that Plaintiffs will prove liability. Mr. Swain presents no valid challenge to the
common damages methodology presented in the Feinstein Report.
LIMITING FACTORS AND OTHER ASSUMPTIONS
This
rebuttal
report
is
furnished
solely for
the purpose of court proceedings in the
above-named matter and may not be used or referred to for any other purpose.
The analysis
and opinions contained in this rebuttal report are based on information available as ofthe date
of this report.
I reserve the right to supplement or amend this report, including in the event
additional information becomes available, and ifand as the Court may permit.
Steven P. Feinstein, Ph.D., CFA
7Swain Report, 4]86-88.
Case 5:21-cv-04337-JMG     Document 139-16     Filed 09/06/24     Page 6 of 7

Exhibit-1 
Steven P. Feinstein, Ph.D., CFA 
Testimony Subsequent to the Feinstein Report 
In re Vale S.A. Securities Litigation 
Case No. 19-cv-526-RJD-SJB 
United States District Court 
Eastern District of New York 
Deposition Testimony 
March 2021 
Deposition Testimony 
October 2023 
Testimony at Evidentiary Hearing 
August 2024 
4
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