Disney Enterprises, Inc. et al v. Hotfile Corp. et al

Filing 217

MOTION to Strike and Memorandum of Law of Defendants Hotfile Corporation and Anton Titov to Strike Plaintiffs' Putative "Rebuttal" Report of Dr. Richard Waterman Before the Close of Expert Discovery on January 17, 2012 and Motion for Expedited Briefing and Hearing at the Upcoming Status Conference on January 13, 2012 by Hotfile Corp., Anton Titov. Responses due by 1/26/2012 (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E, # 6 Exhibit F, # 7 Exhibit G, # 8 Exhibit H, # 9 Exhibit I, # 10 Exhibit J, # 11 Exhibit K)(Munn, Janet)

EXHIBIT “H”

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA

DISNEY ENTERPRISES, INC.,

)

UNIVERSAL CITY STUDIOS
PRODUCTIONS LLLP,
TWENTIETH CENTURY FOX FILM
CORPORATION,
COLUMBIA PICTURES INDUSTRIES,
INC., and

)
)
)

WARNER BROS. ENTERTAINMENT INC.,

)

Plaintiffs,

)

v.

)

CASE NO. 11-20427-WILLIAMSTURNOFF

)
HOTFILE CORP., ANTON TITOV, and
DOES 1-10.

)

Defendants.

)

HOTFILE CORP.,

)

Counterclaimant,

)

v.

)

WARNER BROS. ENTERTAINMENT INC.,

)

Counterdefendant.

)

EXPERT REPORT OF DANIEL S. LEVY, Ph.D.
January 6, 2012

CONFIDENTIAL

TABLE OF CONTENTS
1.

RESEARCH QUESTION

2

2.

QUALIFICATIONS

2

3.

INFORMATION CONSIDERED

2

4.

INTRODUCTION

3

DR. WATERMAN’S SAMPLE

4

5.
a)

Dr. Waterman’s Analysis Excludes 95 Percent Of The Time Hotfile Was In Operation.

b)

4

Dr. Waterman’s Sample And Analysis Excludes “Free-User” Downloads From 47.9 Percent Of Internet
Users

c)

5

Dr. Waterman Mischaracterizes The Statistical and Sampling Process Applied To The Real World Process
Of Drug Trials Required By The FDA

d)

12

Dr. Waterman’s Analysis Based On The Dailydownload File Does Not Even Reflect The Population Of
Downloads From January 2011

e)

14

Conclusion: Dr. Waterman’s Sample Is Not A Valid Scientific Sample of Downloads Through The Hotfile
Website

16

6.

DR. WATERMAN’S ANALYSIS IGNORES MAJOR USES OF HOTFILE.

17

7.

DR. WATERMAN COUNTS MEDIA STORED IN MULTIPART FILES AS SEPARATE
DOWNLOADS
18

8.

NO MEASURE OF HOW “HIGHLY LIKELY” TO INFRINGE

19

9.

MR. ZEBRAK PROVIDES NO MEASUREMENT OF THE RELIABILITY OF HIS
DETERMINATION OF INFRINGEMENT

20

10. CONCLUSION

21

APPENDIX 1

23

APPENDIX 2

31

APPENDIX 3

32

1

1. RESEARCH QUESTION
I have been retained by Farella, Braun + Martel LLP on behalf of Hotfile Corp. and Anton Titov
(collectively, "Hotfile") to review the report of Dr. Richard Waterman dated November 18, 2011
and to assess his conclusions about the incidence of alleged infringement from March 2009
through January 2011 through the Hotfile website related to the various ways that Hotfile is
employed by users.

2. QUALIFICATIONS
I am the National Managing Director and a founder of Advanced Analytical Consulting Group,
Inc. (―AACG‖). I have a Ph.D. in Economics from The University of Chicago. I have designed
and implemented statistical sampling protocols for business analysis and litigations over the
course of more than 25 years. I have provided testimony involving surveys, sampling, statistics,
econometrics, economics and business, among other topics, before state and Federal courts. I
have served as an expert for the US Department of Justice, the US Securities and Exchange
Commission, the New York State Attorney General and served as an Expert Arbitrator for the
Internal Revenue Service. I have testified in a range of matters over a number of years. My
curriculum vitae is attached in Appendix 1.
My billing rate for this case is $650 per hour. The rates of my staff assigned to this project range
from $195 to $550 per hour. Compensation for AACG is not contingent on the outcome of the
proceedings.

3. INFORMATION CONSIDERED
My opinions are based upon the review of documents produced in this matter, interviews,
investigative testimony and testimony from various depositions.
The information I considered has been noted in the footnotes throughout this report. In addition,
I considered other documents. A list of these additional documents can be found in Appendix 2.
In addition, my opinions are based on my skills, knowledge, experience, education, and training,
as well as information gathered by me and provided to me as of the date of this report. It is usual
2

and customary for experts to consider and/or rely upon sources of information such as those
identified in Appendix 2 in forming expert opinions.
My conclusions are based on information I have access to at the time of this report. They are
subject to change based on new information and depositions conducted after the report date.

4. INTRODUCTION
Hotfile provides users a location to store, retrieve, and share computer files through the internet.
By ―uploading‖ computer files through the internet to Hotfile computer servers, Hotfile users can
remotely store their computer files from any location and then retrieve the same files from any
other internet-enabled location. Hotfile users can also provide other internet users access to
uploaded files so that other Hotfile users can ―download‖ files. Users’ uploaded files may be
removed from access by Hotfile after three months unless the file is downloaded by other users
during that time.1 A file that is repeatedly downloaded by another Hotfile user may remain on
Hotfile’s servers indefinitely. A file that is never downloaded may also remain accessible on
Hotfile’s servers over an extended period time if the user pays Hotfile a monthly fee to become a
Premium-user. Any Hotfile user may store files and download files to various internet connected
devices at work, home or while traveling.

Hotfile charges customers a fee to become Premium-users. In addition to the ability to store files
indefinitely, Hotfile’s Premium-users are provided enhanced download abilities, including
greater download speeds, avoidance of any waiting period prior to downloads, and avoidance of
hourly limits on downloads.
Hotfile pays Affiliates for certain downloads of files that they have uploaded and stored on
Hotfile. The amount of payment received depends on the Affiliate's status (Copper, Bronze,
Silver, Gold or Platinum), the number of downloads and the amount of data downloaded. 2 The
Affiliates’ status depends on the ratio of the users who downloaded an affiliate’s files and the
users who become Premium-users based on the affiliate’s uploaded files. It also is influenced by

1
2

http://hotfile.com/faq.html.
http://hotfile.com/terms-of-service.html#affiliate.

3

the ratio of uploaded files to number of downloads. All Hotfile users are eligible to become
Affiliates.3
Hotfile files can be accessed wherever a user can use the internet to access Hotfile's servers.
However, Affiliate users can only earn payments for having their files downloaded by users in
the following countries:
Table 1: List of Countries Eligible in which Downloads are Counted as of January 20114
Americas:

Europe:

North:

Austria

Belgium

Bulgaria

Croatia

Asia and Rest:
Bahrain

China

Hong Kong

Canada

Cyprus

Czech Republic

Denmark

Estonia

Israel

Japan

Kuwait

Mexico

Finland

France

Germany

Gibraltar

Malaysia

Oman

Qatar

United States

Greece

Hungary

Ireland

Italy

Saudi Arabia

Singapore

South Africa

Latvia

Liechtenstein

Lithuania

Luxembourg

Turkey

UAE

South:

Malta

Netherlands

Norway

Poland

Oceania:

Argentina

Portugal

Romania

Russia

Slovakia

Australia

Brazil

Slovenia

Spain

Sweden

Switzerland

New Zealand

United Kingdom
Total: 5

Total: 33

Total: 16

5. DR. WATERMAN’S SAMPLE
a) Dr. Waterman’s Analysis Excludes 95 Percent Of The Time Hotfile Was In
Operation.
In his report, Dr. Waterman used a set of files listed in dailydownload.csv (Dailydownload). Dr.
Waterman uses the Dailydownload file with the goal of creating ―a statistically reliable sample
for a study analyzing the percentage of files downloaded daily that were identified as infringing
from the website operated by the defendants, www.hotfile.com.‖5 Further in his report and at his
deposition, Dr. Waterman makes it clear that he recognizes that his analysis provides no
scientific evidence about Hotfile download or allegedly infringing behavior for any month other

3

http://hotfile.com/affiliate.html.
http://hotfile.com/affiliate.html as of January 2011.
5
Rule 26(a)(2)(B) Report of Dr. Richard Waterman, November 18, 2011, P. 2, Para 2.
4

4

than January 2011.6 This is because, although Dr. Waterman had access to the Dailydownload
file for the preceding twenty-two months of operation7 and download logs from January 2011
through September 2011, Dr. Waterman chose to analyze only the downloads from one month:
January, 2011. As is clearly stated in statistical texts, including those which Dr. Waterman
considers ―canonical,‖8

―[t]he population to be sampled (the sampled population) should

coincide with the population about which the information is wanted (the target population).‖9
Therefore, the analysis in Dr. Waterman’s report cannot, and does not, provide scientifically
valid evidence based on sampling about behavior in any period outside the one from which he
drew his sample: January 2011. Indeed Dr. Waterman points out in his deposition that his goal
was to analyze the downloads from only January 2011.10 Furthermore, for reasons discussed
below, Dr. Waterman’s analysis does not provide any reliable, scientific estimates of the
incidence of alleged infringement even for January 2011.
b) Dr. Waterman’s Sample And Analysis Excludes “Free-User” Downloads From 47.9
Percent Of Internet Users
Dr. Waterman understands that the data analyzed is missing download information for many
countries.

Therefore, Dr. Waterman also agreed at his deposition that his calculated

infringement rate cannot be applied to the downloads from geographic areas that were not
included in the Dailydownload file.11 This is important because the Dailydownload file does not
include data for a set of downloads in the countries listed in Table 2.12

6

RULE 26faH2KB) Report of Dr. Richard Waterman, ¶ 9 and Deposition of Dr. Richard Waterman, November 29,
2011, P. 83, line 12-15.
7
The Dailydownload file date range is 2/24/2009 to 9/6/2011.
8

Arista Records LLC, et al. v. Lime Wire LLC, 06 Civ. 05936, Expert Report of Dr. Richard Waterman, P. 2,
Footnote 1.
9

William G. Cochran, Sampling Techniques, third edition, John Wiley & Sons, New York, 1977, P. 5. The quotation
continues with the following: ―Sometimes, for reason of practicability or convenience, the sampled population is
more restricted than the target population. If so, it should be remembered that the conclusions drawn from the
sample apply to the sampled population.‖
10
Deposition of Dr. Richard Waterman, November 29, 2011, P.37, lines 7-16; P. 87, lines 16-20.
11
Deposition of Dr. Richard Waterman, November 29 2011, P. 140 lines 1-13.
12
Deposition of Anton Titov, December 17, 2011, P. 62, lines 19-20.

5

These

countries

combined

had

956,341,890

internet

users

as

of

2010

as estimated by the World Bank.13
Table 2: Countries with Free-User Downloads Excluded from Dailydownload in January
2011
Afghanistan
Congo, Rep.
Jamaica
Albania
Costa Rica
Jordan
Algeria
Cote d'Ivoire
Kazakhstan
Andorra
Cuba
Kenya
Angola
Djibouti
Kiribati
Antigua and Barbuda
Dominica
Korea, Rep.
Armenia
Dominican Republic
Lao PDR
Aruba
Ecuador
Lebanon
Azerbaijan
Egypt, Arab Rep.
Lesotho
Bahamas, The
El Salvador
Liberia
Bangladesh
Equatorial Guinea
Libya
Barbados
Eritrea
Macao SAR, China
Belarus
Ethiopia
Macedonia, FYR
Belize
Faeroe Islands
Madagascar
Benin
Fiji
Malawi
Bermuda
French Polynesia
Maldives
Bhutan
Gabon
Mali
Bolivia
Gambia, The
Mauritania
Bosnia and Herzegovina
Georgia
Mauritius
Botswana
Ghana
Micronesia, Fed. Sts.
Brunei Darussalam
Greenland
Moldova
Burkina Faso
Grenada
Mongolia
Burundi
Guatemala
Montenegro
Cambodia
Guinea
Morocco
Cameroon
Guinea-Bissau
Mozambique
Cape Verde
Guyana
Namibia
Cayman Islands
Haiti
Nepal
Central African Republic
Honduras
Nicaragua
Chad
Iceland
Niger
Chile
India
Nigeria
China
Indonesia
Pakistan
Colombia
Iran, Islamic Rep.
Panama
Comoros
Iraq
Papua New Guinea
Congo, Dem. Rep.
Sources: World Bank (2010). World Development Indicators Online (WDI) Database.
―Infrastructure: Internet Users.‖ Retrieved from: databank.worldbank.org.
http://hotfile.com/affiliate.html

13

Paraguay
Peru
Puerto Rico
Rwanda
Samoa
Sao Tome and Principe
Senegal
Serbia
Solomon Islands
Sri Lanka
Suriname
Swaziland
Syrian Arab Republic
Tajikistan
Tanzania
Thailand
Timor-Leste
Togo
Tonga
Trinidad and Tobago
Tunisia
Turkmenistan
Tuvalu
Uganda
Ukraine
Uruguay
Uzbekistan
Vanuatu
Venezuela, RB
Vietnam
West Bank and Gaza
Yemen, Rep.
Zambia
Zimbabwe

World Bank (2010). World Development Indicators Online (WDI) Database. ―Infrastructure: Internet Users.‖
Retrieved from: databank.worldbank.org.

6

In contrast to the Free-user downloads from countries listed in Table 2, a set of Free-user
downloads from the countries listed in Table 3 were recorded in the Dailydownload file. The
World Bank estimates that there are 1,041,116,133 internet users in these countries.14 A ―Freeuser‖ download would be any download where an account of a Premium-user was not identified
in the download. This could be a download by a non-Premium-user of Hotfile or a download by
a Premium-user who was not identified as such during the Hotfile download process.
Table 3: Countries with Downloads Included in Dailydownload in January 201115
Argentina
France
Lithuania
Australia
Germany
Luxembourg
Austria
Gibraltar
Malaysia
Bahrain
Greece
Malta
Belgium
Hong Kong
Mexico
Brazil
Hungary
Netherlands
Bulgaria
Ireland
New Zealand
Canada
Israel
Norway
Croatia
Italy
Oman
Cyprus
Japan
Poland
Czech Republic
Kuwait
Portugal
Denmark
Latvia
Qatar
Estonia
Liechtenstein
Romania
Finland
Source: http://hotfile.com/affiliate.html, http://hotfile.com/news.html

Russia
Saudi Arabia
Singapore
Slovakia
Slovenia
South Africa
Spain
Sweden
Switzerland
Turkey
UAE
United Kingdom
United States

This means that any Free-user downloads from 47.9 percent of the internet users form these
countries around the world were not recorded in the Dailydownload file. Therefore, Dr.
Waterman has no scientific statistical evidence about the behavior associated with Free-users
from this 47.9 percent of the internet population in these countries. From his analysis, he cannot
even determine how many of these Free-user downloads there were, even in January 2011 – the
only month Dr. Waterman sampled.
Based on this critical omission alone, Dr. Waterman has not provided scientific statistical
evidence ―from which we can reliably estimate the incidents (sic) of copyright infringement

14

Includes population of Gibraltar in 2010 from WDI 29,244.
http://hotfile.com/affiliate.html, as of January 2011 China was not included by Hotfile among the countries listed
in Table 3.
15

7

through the Hotfile website.‖16 He has no evidence of the overall incidence of alleged
infringement at any given period of time, including January 2011, because he has omitted the
Free-user download behavior of 47.9 percent of the internet users in the world; the
Dailydownload file simply does not count their downloads. And Dr. Waterman does not even
sample downloads through the Hotfile website except for a single month out of the 23 months
through January 2011. That is only 4.3 percent of the time Hotfile had been in service through
January 2011.
i.

Dr. Waterman Provides No Scientific Evidence That His Limited Sampled
Population Reflects The Population Of Downloads Through the Hotfile
Website.

As discussed, Dr. Waterman has excluded from his population of interest all but 4.3 percent of
the time period for which Hotfile was in operation and further has excluded Free-user downloads
from 956,341,890 internet users. These excluded populations had zero percent chance of being
selected in his sample and therefore no scientifically valid statement about their allegedlyinfringing behavior can be made based on the field of sampling science. It is important to note
that there are many files that were not selected for analysis in the limited target population Dr.
Waterman analyzed; Dr. Waterman selected only 1,750 downloads for review out of the
145,691,820 that were in the Dailydownload file in January 2011. This selection of some files for
the sample and the exclusion of other files based on a probabilistic random sample is not a
source of the problems with Dr. Waterman’s sample. A significant source of problems in Dr.
Waterman’s sample, however, is caused by the fact that the files outside of January 2011 were
excluded from his analysis and, in a statistical sense, had no chance of being selected into Dr.
Waterman’s sample. This exclusion of downloads outside of January 2011 makes it impossible
for Dr. Waterman to make any reliable statement about the level of alleged infringement in that
excluded population based on statistical sampling, because this population of downloads had no
statistical chance of being selected into the sample. As we will discuss further below, there are
also segments of the population of downloads within January 2011 which had no possibility of
being selected into Dr. Waterman’s sample. As we will discuss, these omissions render Dr.

16

Rule 26(a)(2)(B) Report of Dr. Richard Waterman, November 18, 2011, P. 8, Para 18.

8

Waterman’s estimates of alleged infringement as unreliable and unscientific even within January
2011.
Any attempt to apply the results from Dr. Waterman’s sample to downloads from the excluded
months and users from excluded geographies would have to be based on some additional
evidence, which Dr. Waterman does not provide. To establish that the other months and
populations exhibited the same downloading behavior as found in the population Dr. Waterman
sampled, Dr. Waterman would need some evidence that these excluded time periods and
geographies had the same copyright infringement behavior as the limited population he sampled.
At times, evidence that the behavior of the excluded population is similar to the sampled
population can be found (although this was not done here). In some cases, extensive research
can be conducted to determine whether there are other factors that correlate with the behavior of
interest. With this knowledge of the strength of these correlating factors, and their values in the
populations that were excluded from the statistical sampling, it may be possible to make
estimates of the incidence of the behavior of interest in the population that had zero chance of
being selected into the sample.17 Dr. Waterman does not attempt to gather any of this
supplementary information that would help inform the nature of the difference between the
population that was sampled (downloads from the January 2011 Dailydownload) and the target
population (downloads through the Hotfile website) which includes additional downloads from
more than 95 percent of the time period Hotfile was in operation and by Free-users drawn from
956,341,890 additional internet users.18
Dr. Waterman’s report does not investigate whether there are any correlates that would be
associated with the incidence of alleged copyright infringement. Hence he cannot determine
whether there is a change over time in these correlates which may help determine whether the
incidence of alleged infringement through the Hotfile website have changed over time. Similarly,
for internet users who were omitted from his analysis because they were located in countries for
which Hotfile did not retain data, Dr. Waterman has no information based on sampling or
17

Even if Dr. Waterman had performed such an analysis, it would not fix the omissions of downloads from his
sample for January 2011. It would therefore leave his estimates for January 2011 unreliable and the extrapolations
to other time periods based on the January 2011 sample would similarly remain unreliable and unscientific.
18
The number of users in each country is based on data from the World Bank in 2010. The number of users did
change over time. Figures for internet users over time can be found in Appendix 3. In addition, the countries for
which Hotfile maintained download data has changed over time. This is a factor that Dr. Waterman would need to
consider if he attempted to study the infringement behavior in earlier periods and other geographies.

9

statistical science to provide any scientifically valid estimates of the incidence of infringing
behavior through Hotfile’s website. He has excluded most of the downloads from Hotfile from
his population of interest, has excluded them from the possibility of being included in his
sample, and has not studied any correlates of infringing behavior that may assist in extrapolating
from his limited target population, January 2011, to any other broader population. For these
reasons, Dr. Waterman has no scientific evidence about the incidence of infringement through
the Hotfile website during the excluded periods and geographies. And as we will discuss below,
his omissions from the population of downloads from January 2011 render his estimates from
that period unreliable and unscientific as well.
ii.

The Hotfile User Environment was Evolving Rapidly

There was rapid change over time in internet behavior through Hotfile. The volume of users was
changing rapidly over time and from month to month. The Hotfile environment is not one where
even this basic feature of the Hotfile environment is similar across months. An appeal to the
stability of use patterns over time at Hotfile would not be supported by the basic data about the
pattern of downloads, uploads and number of users over time. If anything, the Hotfile
environment appears to be rapidly evolving, undermining any assertion that use behaviors were
stable over time. This can be seen in Figure 1, which shows the daily average of downloads by
month for Hotfile.

10

Figure 1

The Average Downloads per Day was changing rapidly across months. Between January 2010
and January 2011 the Average Downloads per Day increased by more than 100%.
In addition, the daily average of uploads per month on Hotfile similarly changed greatly over
time. This can be seen in Figure 2.

11

Figure 2

When comparing January 2011 to prior months, Dr. Waterman states that he has "no reason to
believe that the world changed (in) some dramatic fashion."19 However, the number of uploads
more than doubled from January 2010 to January 2011. From June 2010 to January 2011 the
number of uploads increased by approximately one third. Many companies would consider this
level of growth to be a dramatic change in the behavior of their user base.
c) Dr. Waterman Mischaracterizes The Statistical and Sampling Process Applied To
The Real World Process Of Drug Trials Required By The FDA
During his deposition, Dr. Waterman references ―drug trials‖ in what appears to be an assertion
that drug trials simply rely on samples from one population to determine the effect of a drug on
another population.20 If Dr. Waterman is referring to clinical drug trials of the type required by
the FDA, he has grossly oversimplified the testing and statistical analysis required by the FDA in

19
20

Deposition of Dr. Richard Waterman, November 29, 2011, P. 85, line 1-3.
Deposition of Dr. Richard Waterman, November 29, 2001, P. 106, line 18 - P. 107, line 21.

12

its clinical drug trials in many ways. But perhaps two critical distinctions between what the FDA
requires and what Dr. Waterman appears to be asserting would be useful. First, the FDA clinical
trials require tests to be performed on a range of subjects that have characteristics or covariates
that have been determined through years of clinical trials to be associated with the performance
of the pharmaceuticals in the general population. Thus, through extensive experience and use of
relevant covariates, the medical professionals and physicians at the FDA and the pharmaceutical
manufacturer have extensive information that will allow them to use the covariates they have
built into their study to determine how the pharmaceuticals are likely to function in the broader
population. Dr. Waterman has performed no analysis of the covariates of alleged infringement at
all.
Second, the FDA, in its Phase 4 clinical trials may require extensive monitoring and testing in
the actual population in which the pharmaceutical is being used in the field. Furthermore, ―a
crucial

element

in

this

[FDA]

process

is

that

physicians

report

any untoward

complications….The manufacturer must report adverse drug reactions at quarterly intervals for
the first 3 years after approval, including a special report for any serious and unexpected adverse
reaction.‖21 This is clearly a direct analysis of the population of interest. It is not an assumption
on the part of the FDA that the pharmaceutical will function in the broader population as it did in
the sampled population.
If anything, the FDA process demonstrates that in clinical drug trials the FDA is not comfortable
relying on a sample from one population to project to another population without extensive use
of correlates and then confirmation of the experience of the population of interest through direct
observation. Dr. Waterman does neither of these. His appeal to clinical drug tests does not
support his apparent claim that the FDA uses the type of extrapolation from one population to
another that Dr. Waterman is discussing at that point in his deposition. Consideration of the
actual process required by the FDA in drug testing further demonstrates that extrapolation from
the experience of downloads in the January 2011 downloads files to other months, geographies
or user populations not found in that file is not supported by the science of statistical sampling or
used in the practical application of clinical drug trials required by the FDA.

21

Martin S. Lipsky, MD and Lisa K. Sharp, PhD, From Idea to Market: The Drug Approval Process, JABFP,
September-October 2001, Vol. 14, No. 5, PP. 362-367.

13

d) Dr. Waterman’s Analysis Based On The Dailydownload File Does Not Even Reflect
The Population Of Downloads From January 2011
Dr. Waterman used the Dailydownload file as the source of his population of downloads. 22 As I
discussed above, this file does not include Free-user downloads by 956,341,890 internet users.
But more importantly the Dailydownload file does not even include all of the downloads by
users in the countries where Hotfile did retain information about some of the downloads. As I
discuss next, this attribute of the Dailydownload file leaves Dr. Waterman’s analysis useless for
estimating the incidence of allegedly infringing behavior because he does not actually have the
information to determine how many downloads there were even in his restricted sample of
downloads from January 2011 and the limited set of countries for which Hotfile retained
download information in the Dailydownload file. This critical flaw in Dr. Waterman’s analysis
results from the fact that the Dailydownload file: (1) does not contain all the downloads by
Premium-users; (2) does not include the count of downloads for files downloaded by ―Hotlinks‖;
(3) does not include downloads by Free-users numbering more than 10 downloads in a 24 hour
period; and (4) does not include any downloads of files that were anonymously uploaded to
Hotfile. Dr. Waterman does not know how many downloads he is missing from his analysis. He
does not know the size of the target population from which he is trying to sample. Because Dr.
Waterman does not know the number of downloads excluded from his analysis or the total size
of the actual population of downloads, he cannot know the percent of alleged infringement in the
actual downloaded files through the Hotfile system. Therefore he cannot provide any scientific
evidence whatsoever of the percent of alleged infringement based on downloads through the
Hotfile website.
i

Dr. Waterman’s Analysis Excludes Repeat Downloads By Premium-users

The Dailydownload file does not include counts of the Premium-user downloads completed
within 15 minutes of each other.23 A segment of downloads from January 2011 in the ―Affiliate‖
countries are therefore not included in the Dailydownload file.24 Dr. Waterman’s analysis is
missing these downloads. He does not know whether these downloads tend to infringe copyrights

22

Rule 26(a)(2)(B) Report of Dr. Richard Waterman, November 18, 2011, P. 8, Para. 4.
Based on conference with Anton Titov.
24
In conversations with Anton Titov, I have confirmed that an entire segment of repeat downloads by the same
Premium ID are not counted in the Dailydownload file.
23

14

or not. He does not even know how many of these downloads there are. Without knowledge of
how many of these downloads have occurred each month, Dr. Waterman cannot provide any
scientific statistical evidence about the percentage of allegedly-infringing daily downloads
through the Hotfile website, even during January 2011.
ii

Dr. Waterman’s Analysis Excludes All “Hotlink” Downloads

Premium-users can provide a ―Hotlink‖ to other individuals which allows the other individuals to
download the Hotlinked file with improved access features compared to those available to
standard Free-users. These downloads via a Hotlink are not counted in the Dailydownload file.
As I understand it, they are not counted for payments by Hotfile to Affiliates (the purpose for
which the Dailydownload file was created).25 Again, Dr. Waterman, does not address how many
of these files downloaded by Hotlinks are missing from the Dailydownload file and therefore
from his sample and analysis. Further, since he does not have the Hotlink downloads in his
sample, he cannot determine whether these files tend to be infringing or not. Again, due to this
omission, Dr. Waterman cannot provide any scientific statistical evidence about the percentage
of alleged copyright infringement through the Hotfile website even during January 2011.
iii.

Dr. Waterman’s Analysis Excludes Downloads by Free-Users Numbering
More Than 10 In A 24 Hour Period

The Dailydownload file does not count downloads by Free-users once they have reached 10
downloads in a 24-hour period. So once a Free-user has downloaded 10 files in a 24-hour period
all subsequent downloads are omitted from the Dailydownload file.26 Again, Dr. Waterman does
not address how many of these files downloaded by Free-users are missing from the
Dailydownload file and therefore from his sample and analysis. Further, since he does not have
these downloads in his sample, he cannot determine whether these files tend to be infringing or
not. Again, due to this omission, Dr. Waterman cannot provide any scientific statistical evidence
about the percentage of alleged copyright infringement through the Hotfile website even during
January 2011.

25
26

Communication with Anton Titov.
Communication with Anton Titov.

15

iv.

Dr. Waterman’s Analysis Excludes All Downloads That Were Anonymously
Uploaded.

Hotfile users can upload files without providing any individual information. These files are
―anonymously‖ uploaded by anyone who is not identified by Hotfile or logged into Hotfile.
These anonymously-uploaded files are not eligible for Affiliate payments.27 Again, this means
that Dr. Waterman could not have selected these files for review. Further, Dr. Waterman does
not have any count of the number of files that were downloaded from anonymous uploads. Dr.
Waterman does not know how large the target population of downloads actually is, for this
reason. In addition, Dr. Waterman does not know whether these files tend to infringe or not. For
this reason, in addition to the missing downloads discussed above, Dr. Waterman cannot
determine the percentage of downloads through the Hotfile website that allegedly infringe
copyrights.
e) Conclusion: Dr. Waterman’s Sample Is Not A Valid Scientific Sample of Downloads
Through The Hotfile Website
In total, Dr. Waterman’s sample is not a valid scientific sample of the ―incidents (sic) of
copyright infringement through the Hotfile website,‖28 which was the concluding goal of Dr.
Waterman’s report. It is not a valid sample of downloads through the Hotfile website because (1)
it excludes Free-user downloads from 47.9 percent of the world’s internet users due to their
geography, (2) it excludes more than 95 percent of the time period for which Hotfile was in
service, (3) it excludes the repeated downloads by Premium-users downloaded within 15
minutes, (4) it excludes Hotlink downloads, (5) it excludes downloads numbering more than 10
in a 24-hour period for Free-users and (6) it excludes the downloads of files uploaded
anonymously.
These are not minor omissions. The omissions of download in category 1 above make Dr.
Waterman’s estimates inapplicable to the downloads by 956,341,890 internet users.

Dr.

Waterman’s choice to exclude all months but January 2011 eliminate 1,882,459,335 downloads
from affiliate countries from his analysis, the vast majority.

27
28

Communication with Anton Titov.
Rule 26(a)(2)(B) Report of Dr. Richard Waterman, November 18, 2011, P. 8, Para 18.

16

Due to the omissions of downloads in categories 3, 4, 5 and 6, Dr. Waterman cannot even tell us
how many downloads there were during January 2011, let alone the percentage of them that
allegedly infringed. These sampling errors, in categories 3 through 6, make Dr. Waterman’s
estimates inapplicable to the question of the percentage or incidence of allegedly-infringing
behavior through the Hotfile website even during the limited period of January 2011 and the
limited geography of Affiliated countries.29

6. DR. WATERMAN’S ANALYSIS IGNORES MAJOR USES OF
HOTFILE.
Dr. Waterman’s analysis, which focuses on downloads, ignores any other uses of Hotfile. He
does not investigate the storage function of Hotfile. He does not investigate the backup and
security functions of Hotfile. He does not investigate the file transfer activity on Hotfile between
devices owned by one individual. Even if Dr. Waterman’s sample of downloads provided a valid
sample of downloads to inform this case, which it does not, his study does not reflect the range
of user behavior on the Hotfile website because it focuses on only one of the uses and benefits
Hotfile provides to users.
Hotfile data list no downloads for 54 percent of all files in the Uploaddownload file which
contains a record for files uploaded to Hotfile since February 19, 2009. Although there are
omissions in the downloads counted by Hotfile, as discussed in detail above, there is the
potential that a large percentage, or a majority, of files uploaded to Hotfile were never
downloaded.30 However, given that as much as 54 percent of the files ever uploaded to Hotfile
are used in this way, it seems that the storage function could be a significant aspect of how
Hotfile is used.
29

Dr. Waterman could have employed more comprehensive data provided by Hotfile to perform his sampling
analysis. The Dailydownload file contains downloads starting with a partial month of data in February 2009. The
Uploaddownload file contains information about uploads and additional downloads starting with a partial month of
data in February 2009. The Download logs contain essentially comprehensive information regarding downloads
after March 2011.
30
Information comes from uploaddownloads.csv, which as I understand it, contains a unique record for uploaded
files. To find total downloads, I summed the fields ―downloads‖ and ―paid downloads‖. My understanding is that
―downloads‖ gives a count of downloads from free-users and ―paid downloads‖ gives a count of downloads from
premium-users that were counted by Hotfile with the exception that some of the omissions discussed above are also
omitted from the Uploaddownload file.

17

Given the magnitude of this one activity alone, it is clear that in order to assess the incidence of
allegedly-infringing usage of Hotfile, these other functions would have to be investigated in
addition to performing a scientific and relevant sample of downloads in place of the sampling
performed by Dr. Waterman.

7. DR. WATERMAN COUNTS MEDIA STORED IN MULTIPART
FILES AS SEPARATE DOWNLOADS
Some users cut a single piece of media into multiple parts for storage and downloading on
Hotfile. In some cases a single piece of media is cut into six or more parts. Some of these files,
for example many with the RAR extension, are cut into pieces in such a way that it is difficult to
view or read the file unless all of the Parts of the *.RAR file have been downloaded for a specific
piece of media. Therefore, for example, a movie that has been stored in a six part RAR would
require six downloads from Hotfile to be functional for most or all users. Alternatively, a movie
of similar file size could be stored in a single file. In Dr. Waterman’s sampling protocol, a single
piece of media stored in multiple parts has a greater chance of being sampled than that same
piece of media stored in a single file.31
Take for example two pieces of media, one infringing and one not, where both are downloaded
once. If the infringing file is stored in a ten part RAR file the download of the entire piece of
media would be counted as 10 downloads. If the non-infringing file is stored in a single file, the
download of the entire file will result in one download. Therefore, under the counting system
devised by Dr. Waterman, the download of this one infringing film and this one non-infringing
film would result in a count of 10 infringing downloads and one non-infringing download, for a
91 percent incidence of infringing downloads. But this resulted from the download of one
infringing film and one non-infringing film, in this example.
Clearly the method of counting downloads of multipart files can have an important impact on the
measured incidence of infringing downloads.

To investigate the impact of downloads of

multipart files, I selected the most common file types used with multipart files, the .part##.RAR
extension and files for which the final part of the file extension is made up of three numbers, for
31

For this discussion, I consider the media to be downloaded the same number of time whether it is stored in a
single file or in a multipart file.

18

example ―.avi.001‖. Based on Dr. Waterman’s sampling and the files he received, I was able to
determine how many parts each of the multipart files had in the Dailydownload file that Dr.
Waterman used.32 Based on the number of parts each of the files had, I reversed the weighting
that Dr. Waterman had applied to the media found in the multipart files, by dividing the
observation Dr. Waterman had selected by the number of parts the file had been divided into.
This provides an estimate of the incidence of alleged infringement if each of these multipart files
had been stored and downloaded as a single file; a download of one movie is counted as one
download regardless of how many parts used to store it. Even leaving all the other omissions and
errors in Dr. Waterman’s analysis intact, this single change in the method of counting downloads
for multipart files, such as RAR and AVI extension files, reduces the estimated level of alleged
infringement. This reduction in the percentage of alleged infringement occurs because these
multipart files tended to be found by Plaintiffs’ witness, Mr. Zebrak, to infringe copyright more
than single part files.
There are likely other multipart files in addition to the ones I have identified using the method
outlined above. Without more analysis of these multipart files, it is not possible to determine the
extent to which the counting process devised by Dr. Waterman influences the incidence of
alleged infringement.

8. NO MEASURE OF HOW ―HIGHLY LIKELY‖ TO INFRINGE
For the vast majority of files that Mr. Zebrak reviewed - 82.6 percent33 according to Dr.
Waterman34 - Mr. Zebrak could not determine whether the downloaded file infringed or did not
infringe. Mr. Zebrak was only able to give it a relative status of Highly Likely to infringe.
However, neither Dr. Waterman nor Mr. Zebrak provided a quantitative assessment of how

32

For example, Waterman’s sample included a file called A.Christmas.Carol.2009.DvDrip-aXXo.part2.rar
(uploadid: 90857607). The file studio_requested_fileinfo.csv shows that Waterman and his team requested both
A.Christmas.Carol.2009.DvDrip-aXXo.part1.rar (uploadid: 90855097) and A.Christmas.Carol.2009.DvDripaXXo.part2.rar (uploadid: 90857607) from Hotfile to review. In this case, I classify the sampled file,
A.Christmas.Carol.2009.DvDrip-aXXo.part2.rar (uploadid: 90857607), as having two parts.
33
The upper and lower 95 percent confidence intervals are 84.4 percent and 80.8 percent.
34
Rule 26(a)(2) (B) Report of Scott Zebrak Appendix C. I calculated proportions separately for ―confirmed
infringing‖ and ―highly likely infringing‖ files, using methods that produce the same result as those produced by Dr.
Waterrnan for the proportion of files either ―confirmed‖ or ―highly likely infringing‖: (10*(proportion of weekend
files that infringe)+21*(proportion of weekday files that infringe))/31— William G. Cochran, Sampling Techniques,
third edition, John Wiley & Sons, New York, 1977, page 107; Eq. 5.52.

19

likely a Highly Likely download was to infringe. We are provided no information whether highly
likely means 66 percent, often known as a super majority, or 99 percent likely to infringe, or any
other percentage. Furthermore, we are not provided any information to suggest that such a
quantification was even performed or can be provided by Mr. Zebrak. If ―Highly Likely‖ means
66 percent then 66 percent of the 82.6 percent Highly Likely infringing downloads are actually
estimated to be infringing. That would be 54.5 percent of the total files would be infringing
(54.5%=66% x 82.6%) based on the Highly Likely pool. Adding in the 7.7 percent based on the
confirmed infringing status, a total of 62.2 percent of the downloads would be infringing. If 85
percent of the Highly Likely files are actually infringing then 77.9 percent of the downloads
sample by Dr. Waterman would be infringing.35
It is clear that some evidence about the percent of Highly Likely files that actually infringe is
needed to provide the basis for a scientific sampling and extrapolation of the incidence of
infringement through the Hotfile website. Neither Dr. Waterman nor Mr Zebrak provide this
required information.

9. MR. ZEBRAK PROVIDES NO MEASUREMENT OF THE
RELIABILITY OF HIS DETERMINATION OF INFRINGEMENT

Not only has Mr. Zebrak not quantified how likely the Highly Likely Infringing files are to
infringe, but he has also provided no information about the reliability of his assessments and
coding of alleged infringement. The measurement of coding reliability is common in situations
where individuals review some record and make some assessment about the record based on the
review. It is common practice in scientific research to determine how reliably the coders have
assessed the records.36 Clearly individuals make mistakes or differ in their interpretations about

35

70.2% = 85% x 82.6% from the Highly Likely observations plus 7.7% from the Confirmed observations for a total
77.9%.
36
See for example Jackson, Sherri L. (2012). Research Methods and Statistics: A Critical Thinking Approach, 4 th
Edition. Wadsworth, Cengage Learning. Webb, Noreen M. et. al. (2007). ―Reliability Coefficients and
Generalizability Theory.‖ In Rao, C.R. and Sinharay (eds.) The Handbook of Statisitcs vol. 26: Psychometrics.

20

the status of a given piece of media.

To the extent that they disagree about the final

determination of a piece of media their determinations are considered to be not Reliable.
Coding Reliability is often tested and measured by having some portion of the records that are
being reviewed coded by a second coder to determine the percentage of times where there is
agreement between coders. If we know the percent of times that there was not agreement we
could factor that into our assessment of the overall infringement levels. But neither Mr. Zebrak
nor Dr. Waterman has provided this type of measure. Again this is not a minor omission. Some
researchers consider coded data of the type provided here unusable if some measure of the
Reliability of the coding is not provided.37
So in addition to some measure of how likely a file categorized as Highly Likely is to infringe,
we also need some measure of how Reliable Mr. Zebrak’s coding process was.

10.

CONCLUSION

For the reasons stated above Dr. Waterman has not provided a scientifically reliable estimate of the
incidence of allegedly-infringing behavior through the Hotfile website.

As he stated in his

deposition, Dr. Waterman did not intend to provide a scientific estimate of the incidence of alleged
infringement in downloads from the Hotfile website outside the time period of January 2011, and
he did not. In addition, as stated in his deposition, he did not provide a scientific estimate of the
allegedly-infringing behavior from the non-Affiliate geographies. Further, due to various
omissions in downloads from the file Dr. Waterman used to construct his sample, Dr. Waterman
has also failed to provide a scientifically reliable estimate of the incidence of infringement in the
downloads from the Hotfile website during January 2011. Dr. Waterman has provided no reliable
scientific evidence about the overall population of downloads from the Hotfile website during any
time period.
In addition, Dr. Waterman has investigated only one aspect of how users employ Hotfile. He has
not investigated the storage, file security and backup or

single users’ file transfer across

Elsevier. Stemler , Steven and Jessica Tsai. (2008). ―Best Practices in Interrater Reliability: Three Common
Approaches.‖ In Jason Osborne (ed.) Best Practices in Quantitative Methods. Sage Publications.
37
Neuendorf, Kimberly A. (2002). The Content Analysis Guidebook. Sage Publications. p.142.

21

locations or devices for self use. Dr. Waterman has not investigated the alleged infringement
behavior across the uses of Hotfile.
Finally, neither Dr. Waterman nor Mr. Zebrak have provided any estimate or analysis of how
likely files designated as "Highly Likely" are to infringe. Without this information it is not

possible to calculate the proportion of allegedly-infringing behavior through the Hotfile website.

January 6, 2012

22

APPENDIX 1
DANIEL S. LEVY, PhD
National Managing Director
Advanced Analytical Consulting Group, Inc.
Phone: [phone]
Email: [e-mail]

EDUCATION
Ph.D., Economics, The University of Chicago
A.B., Economics, The University of Chicago (With Special Honors in Economics)
Daniel S. Levy specializes in applications of economics and statistics. He has testified about
sampling and statistical issues in Federal Court, presented statistical issues to Government
Agencies and served as an Expert Arbitrator.

Dr. Levy has developed and implemented advanced analytical methods for quality control tests
for major corporations. For more than a decade, Dr. Levy led a team of economists and
statisticians in monthly testing of quality of service for multiple telecommunications companies.
His analyses of sampling and statistical issues include testimony for the Securities and Exchange
Commission and the Department of Justice and have been presented in Federal Court. He also
has performed economic and statistical work in telecommunications, transportation,
manufacturing, financial services, mining, oil and gas, consumer durables, healthcare,
pharmaceuticals and medical devices industries. He has extensive experience in developing
statistical methods for practical business applications.

As part of his antitrust and market

demand research, Dr. Levy has developed and used large GIS software databases.

Prior to Advanced Analytical Consulting Group, Inc., Dr. Levy was the national leader of the
Economic and Statistical Consulting Group at Deloitte Financial Advisory Services and Global
Leader of Economic Consulting at Arthur Andersen’s Business Consulting Group. He also held
research and consulting positions at Charles River Associates, The RAND Corporation,
23

Needham-Harper Worldwide Advertising, SPSS Inc. and The University of Chicago
Computation Center.

EXPERT TESTIMONY/AFFIDAVITS
Brian Driscoll et al. v Granite Rock Company, no. 108-CV-103426 Class Action, 2011,
Expert Deposition.
United States of America , ex rel. Thomas F. Jamision v McKesson Corporation et al,
Civil Action No. 2:08CV 214-SA-DAS, 2011, Expert Report.
Oracle USA, Inc., et al v. SAP AG, et al, 2009, Case No. 07-CV-01658 PJH (EDL),
2010, Reply Exert Report Regarding Daubert of Defendants Damages Expert.
Oracle USA, Inc., et al v. SAP AG, et al, 2009, Case No. 07-CV-01658 PJH (EDL),
2010, Exert Report Regarding Daubert of Defendants Damages Expert.
Oracle USA, Inc., et al v. SAP AG, et al, 2009, Case No. 07-CV-01658 PJH (EDL),
2010, Exert Report Regarding Daubert of Defendants Damages Expert.
Oracle USA, Inc., et al v. SAP AG, et al, 2009, Case No. 07-CV-01658 PJH (EDL),
2010, Deposition.
Oracle USA, Inc., et al v. SAP AG, et al, 2009, Case No. 07-CV-01658 PJH (EDL),
November 2009, Expert Report.
Glenn Burton, Jr. v. American Cyanamid Co., et al, United States District Court Eastern
District of Wisconsin, Case No. 07-C-0303, March, 2010.
Yasmine Clark v. American Cyanamid Co, et al. State of Wisconsin Circuit Court :
Milwaukee County, Case No. 2006 CV 12653, Case Code 30107, June 1, 2010
Securities and Exchange Commission v. Brantley Capital Management, LLC, Robert
Pinkas, and Tab Kiplinger, United States District Court, Northern District of Ohio,
Eastern Division, Case 1:09-cv-01906-JG, Expert Report and Deposition, 2010
Stephen Markson v. MBNA Canada Bank Court File 03-CV254970CP, January 2009,
July 2009
Mary Lewis et al. v. NL Industries et al, 2009, Circuit Court of Cook County, Illinois
County Department, Chancery Division, Case No. 00 CH 9800.
Drs Newco III, Inc v. Night Vision Equipment Company Holding, Inc, 2008, Expert
Report, Testimony, Damages in High Technology Market.

24

Invesco Institutional (N.A.) Inc v. Deutsche Investment Management Americas, Inc,
2008, Expert Report, Damages in Financial Services Industry.
Securities and Exchange Commission v. Kenneth D. Pasternak and John P. Leighton,
2007, 2008. Expert Report and Testimony. Damage Analysis.
Cytologix v. Ventana, Expert Report and Testimony, 2002, 2007. Antitrust
Rubin Squared Inc. v. Cambrex Corporation, 2006 Case No. 03-CIV. 10138(PAC) Expert
Report.
Polaris Industries Inc. v. Commission of Revenue, 2005, Expert Report, Minnesota Tax
Court, Docket No. 7694-R
Before the New Mexico Department of Insurance, 2004, Expert Report, Health Insurance
Merger.
Carolyn Fears v. Wilhelmina et. al. 2004, Expert Report and Deposition, Antitrust.
Shoshone and Arapaho Indian Tribes v. the United States of America, 2003, Expert
Report, Statistical Sampling.
Pechiney Plastic Packaging Inc. v. Continental PET Technologies Inc. 2002, Expert
Report and Deposition, 2002, Statistical Sampling/Patent Infringement.
Cytologix v. Ventana, 2002, Expert Report, Antitrust.
Before the Illinois Commerce Commission, 2001, Expert Report and Testimony,
Statistical Methods and Telecommunications Performance.
IRS Expert Arbitrator, 2000, James Schilling Inc., v. Internal Revenue Service, Expert
Arbitrator Report and Decision.
Expert Witness, 1999, before the New Mexico Insurance Commissioner, Hospital
Merger.
Before the Michigan Public Service Commission, 1998, Expert Affidavit, Statistical
Analysis.
25

Statistical Methods for Parity Tests of Telecommunications Resale and Retail Markets,
Before the Indiana Public Service Commission, 1998, Expert Affidavit, Statistical
Analysis.
Before the FCC, CC Docket No. 98-56, RM-9101, 1998, Expert Affidavit, Statistical
Analysis.
Graber, A. et al. v. Giuliani, United States District Court Southern District of New York,
1998, Expert Affidavit and Deposition, Statistical Sampling and Survey Research.
Marisol, A. et al. v. Giuliani, United States District Court Southern District of New York,
1998, Expert Affidavit and Deposition, Statistical Sampling and Survey Research.
DFW v. Continental Air Lines, Texas, 1998, Expert Deposition and Testimony.
Randall’s Food Markets, Inc., v. Fleming Companies, Inc., The American Arbitration
Association Dallas, Texas, June, 1998, Expert Affidavit, Statistical Sampling.
Randall’s Food Markets, Inc., v. Fleming Companies, Inc., The American Arbitration
Association Dallas, Texas, February 1998, Expert Report, Statistical Sampling.
Donald E. Haney v. Timesavers Inc., et al. United States District Court, District of
Oregon, January 1998, Expert Testimony, Patent Infringement.
Merck-Medco Managed Care Inc. v. Rite Aid Corporation et al. Northern District of
Maryland, May 1997, Expert Deposition, Antitrust.
Donald E. Haney v. Timesavers Inc., et al. United States District Court, District of
Oregon, July 1997, Expert Report, Patent Infringement.
Kenneth Heubert Williams v. Honri Vashon Hunt et al., State of Michigan in the Circuit
Court for the County of Oakland, May 1997, Expert Deposition, Value of Life.
Merck-Medco Managed Care Inc. v. Rite Aid Corporation et al. Northern District of
Maryland, April 1997, Expert Report, Antitrust.

26

Robinson Rubber et al. v. Hennepin County, Minnesota, United States District Court,
District of Minnesota, Fourth Division, April 1997, Expert Deposition, Antitrust.
Robinson Rubber et al v. Hennepin County, Minnesota, United States District Court,
District of Minnesota, Fourth Division, April 1997, Expert Report, Antitrust.
Massachusetts Wholesalers of Malt Beverages, Inc., v. Commonwealth of Massachusetts
et al, Suffolk Superior Court, 1996, Expert Testimony, Financial Damages.
Luke Brothers v. S. P. Krusell, US District Court, District of Massachusetts, July 1996,
Expert Affidavit, Antitrust.
Luke Brothers v. S. P. Krusell, US District Court, District of Massachusetts, August
1996, Expert Affidavit, Antitrust.
Daras v. Texaco Inc, 1993, Affidavit.
Environmental Protection Agency: Navajo Generating Station, 1991, Public Comment,
Valuation of Environmental Damages.

PROFESSIONAL EXPERIENCE
2009 – Present
2002 - 2009
2001 - 2002
1998 - 2001
1996 - 1998
1995 - 1996
1991 - 1995
1988 - 1991
1985 - 1988
1982 - 1985
1981 - 1982

National Managing Director, Advance Analytical Consulting Group, Inc.
National Leader of Economic and Statistical Consulting, Deloitte FAS LLP
Global Director of Economic and Statistical Consulting, Arthur Andersen:
Value Solutions
National Director of Economic and Statistical Consulting, Arthur Andersen:
Business Consulting
Regional Director of Economics, Arthur Andersen: CRCO
Economist, Arthur Andersen
Senior Associate, Charles River Associates
Associate Economist, The RAND Corporation
Computer Advisor, The University of Chicago Computation Center
Research and Teaching Consultant, SPSS Inc.
Research Consultant, Needham, Harper Worldwide Advertising

PROFESSIONAL HONORS AND ACTIVITIES
Earhart Fellowship for graduate research in economics, 1981 - 1982
27

Hewlett Grant for research in developing countries, 1985 - 1986; renewed, 1986 - 1987
CBS Bicentennial Scholarship for research on events leading to the American
Revolution, 1986 - 1987
Homer and Alice Jones Fellowship, University of Chicago, 1987 - 1988
American Economics Association, 1988- Present
Population Association of America, 1988-1991

PAPERS, PRESENTATIONS, AND PUBLICATIONS
Daniel S. Levy ―Foundations of Pricing,‖ Presented at the Professional Pricing Society Meetings,
Oct 2010.
Daniel S. Levy. ―New Econometric Techniques for Transfer Pricing.‖ Presented at the American
Bar Association Annual Meetings, August, 1997.
Daniel S. Levy et al. ―Economics and the New Transfer Pricing Regulations: Achieving Arm’s
Length Through the Invisible Hand.‖ Special Report to Transfer Pricing Reporter, Vol. 4, No. 2,
May 24, 1995.
Daniel S. Levy and Deloris R. Wright. ―In the OECD and the United States, It’s the Arm’sLength Principle that Matters: Comparison of New Transfer Pricing Regulations.‖ International
Transfer Pricing Journal 1, No. 2, January 1995.
Robert Fagan, Manjusha Gokhale, Daniel S. Levy, Peter Spinney, and G.C. Watkins.
―Estimating DSM Program Impacts for Large Commercial and Industrial Electricity Users.‖
Presented at 1995 International Energy Program Evaluation Conference, Chicago, IL, August
1995.
Talk on the EPA’s decision to require the Navajo Generating Station to reduce emissions to
protect visibility in the Grand Canyon.

Panel on ―Valuation of Environmental Resource

Damages,‖ CRA conference on Economists’ Perspectives on Legal Issues Today: Estimating
Damages, Boston, MA, April 23, 1992.
Daniel S. Levy et al. ―Conceptual and Statistical Issues in Contingent Valuation: Estimating the
Value of Altered Visibility in the Grand Canyon.‖ (MR-344-RC). Santa Monica, CA: RAND
Corporation, 1995. Draft submitted to the Environmental Protection Agency, March 1991.

28

Daniel S. Levy and D. Friedman. ―The Revenge of the Redwoods?: Reconsidering Property
Rights and Economic Allocation.‖ The University of Chicago Law Review (April 1, 1994).
Reprinted in Land Use and Environment Law Review 26 (September 1995).
Lois Davis, Susan Hosek, Daniel S. Levy and Janet Hanley, ―Health Benefits for Military
Personnel: An Overview of Their Value and Comparability to Civilian Benefits‖ (WD-5875FMP). Santa Monica, CA: RAND Corporation, February 1992.
D. Buddin, J. Hanley, Daniel S. Levy, and D. Waldman. Promotion Tempo and Enlisted
Retention (R-4135-FMP). Santa Monica, CA: RAND Corporation, August 1991.
Daniel S. Levy et al. ―Comments On Contingent Valuation of Altered Visibility in the Grand
Canyon Due to Emissions from the Navajo Generating Station.‖ Presented to the Environmental
Protection Agency, April 18, 1991.
Daniel S. Levy. ―The Economic Demography of the Colonial South.‖ Ph.D. Thesis, Department
of Economics, University of Chicago, 1991.
J. DaVanzo and Daniel S. Levy. ―Influences on Breastfeeding Decisions in Peninsular
Malaysia.‖ Presented at The Yale Conference on the Family, Gender Differences, and
Development, September 1989.
Daniel S. Levy. ―Long-Run Geographic and Temporal Changes in Mortality in the Colonial
South.‖ Presented at the annual meeting of the Population Association of America, Baltimore,
1989. Submitted 1995 to Social Science History.
Daniel S. Levy. ―The Economic Determinants of Family Sizes in Colonial Maryland: Evidence
from Colonial Legislators of Maryland.‖ Presented at the Social Science History Association,
Chicago, 1989.
Daniel S. Levy. ―The Epidemiological Causes of Changing Political Life Expectancies.‖
Manuscript, 1989.
Daniel S. Levy. ―The Life Expectancies of Colonial Maryland Legislators.‖ Historical Methods
20, No. 1 (Winter 1987): 17 27.

29

David W. Galenson and Daniel S. Levy. ―A Note on Biases in the Measurement of Geographic
Persistence Rates.‖ Historical Methods 19, No. 4 (Fall 1986): 171 179.

30

APPENDIX 2
dailydownload.csv
dailydownload.csv.headers
estimation_11172011.txt
studio_requested_fileinfo.csv
uploaddownloads.csv.headers
uploaddownloads.csv
Waterman Ex C.pdf
Waterman Ex D.pdf
Waterman Ex E.pdf
Waterman Report.pdf
Waterman FULL Transcript.pdf

http://hotfile.com/affiliate.html
http://hotfile.com/news.html
http://hotfile.com/terms-of-service.html#affiliate

William G. Cochran, Sampling Techniques, third edition, John Wiley & Sons, New York, 1977
World Bank (2010). World Development Indicators Online (WDI) Database. ―Infrastructure:
Internet Users.‖

31

APPENDIX 3

32