Is the U.S. Government Doing Bill Ackman’s Bidding?

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April 11 (Bloomberg) -- Cadwalader, Wickersham & Taft’s Adam Lurie discusses a FBI and DOJ probe into Herbalife, and the government’s avoidance of appearing to take sides. He speaks on Bloomberg Television's “Market Makers.” (Source: Bloomberg)

See a clip of an interview i did a few months ago with bill ackman when he is just so convinced of this trade.

What we focus on is not with the stock prices on any one day or year.

But our business progress.

The business rye grass is touring a -- telling a story with regulators.

Assuming they could issue bonds and we were forced out of the trade, we would replace the position swaps.

We're going to take this to the end of the earth.

He has been waiting for a year and a half for regulators to get involved.

Now they have.

Does this mean he has won the game?

I don't think so.

The government is looking for three things.

They will be looking for evidence of lies, cheating, and stealing.

What the government will likely focus on is whether or not the company is selling or not selling its products to real salespeople giving the product to distributors in exchange for a fee and claiming the fees as real sales revenue.

This is what ackman has been calling for months.

How real is it that we are going to get an outcome that ackman wants to hear?

If you are the fbi, how does it look it at the end you say there is nothing there?

I do not think the justice department will be concerned about how it looks at the end of this.

My guess is they are probably treading carefully.

They do not want to be seen as doing the ending of an activist investor.

It is quite possible this investigation has been going on for some time and they have been quiet.

Whether you have firsthand knowledge or not, do you buy that herbalife said they had no idea that the government was looking into them?

It is hard to know whether they had no idea.

It may be true that they were never contacted directly by the at the eye or the justice department -- fbi or the justice department.

There have been other regulators looking into this already.

It is possible the government has been getting information from them and said of reaching out directly to herbalife.

What about bill ackman's rol e? without him, would they be looking into it?

Is seems unlikely -- it seems unlikely.

This is front and center to regulators.

It has reportedly gotten the attention of the justice department.

From the justice department, what would you guess the timing is?

When we hear about the announcement on friday, it has recovered a little bit today.

How long do these things play out?

Too long if you are the company.

It takes a long time to play out.

It is quite possible the justice department and fbi have been looking into this for some time.

They are going to look into this until they are satisfied that they found evidence of the lying and cheating and stealing.

What is the next step?

We know the investigation is going on.

What shall we be looking for next?

We will look for a potential contact for the company.

That is one thing.

Another thing we can be looking for our witnesses being called in to get interviews or to give testimony to a grand jury.

Those sorts of things could signal that this investigation has gone to a higher level.

In terms of volume, just to give us a sense, many say bill ackman was crazy to begin with.

Based on what the government is going to do is a tough that.

How many investigations do they do in a year?

What this into context.

-- put this into context.

The government does a lot of investigations a somewhat as reported in the press are what they may hear on television shows like this.

Or based on the word of an anonymous tip.

They have the responsibility to look into serious allegations.

The concern here maybe the government is somewhat concerned about doing the bidding for somebody who has such a strong economic interest in the outcome.

The loudest tip ever, though

This text has been automatically generated. It may not be 100% accurate.


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