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Herbalife Soars As Belgian Court Confirms Not A Ponzi Scheme

Tyler Durden's picture


Unfortunately for Bill Ackman, another leg of the "short Herbalife to the grave" thesis just broke when a Belgian Appeal Court hearing overturned its previous findings:


The stock is up 5% on the news, breaking to a new record high above $75.



Herbalife PR Statement:

Global nutrition company Herbalife (NYSE: HLF), welcomes the judgment by a Belgian Appeal Court that states the company`s sales model is in full compliance with Belgian law.

This judgment overturns a previous ruling by the lower court, in response to claims brought by Belgian consumer organization Test-Aankoop, that Herbalife was operating a pyramid scheme.

Herbalife always believed that the first judgment contained factual errors and was based on misinterpretations of its direct-selling sales method, and was confident that the original judgment would be overturned on appeal.


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Tue, 12/03/2013 - 13:41 | Link to Comment Al Huxley
Al Huxley's picture

You would think that confirming its not a ponzi scheme would be bad news in todays ponziconomy.

Tue, 12/03/2013 - 13:46 | Link to Comment Hedgetard55
Hedgetard55's picture



They also concluded Social Security, Medicare and the US Dollar are not Ponzi schemes either.

Tue, 12/03/2013 - 13:45 | Link to Comment NotApplicable
NotApplicable's picture

Payin' it forward, yo!

Tue, 12/03/2013 - 14:10 | Link to Comment kliguy38
kliguy38's picture

Do ya think Carl is givin' Bil a tug right now or just slammin' it...........

Tue, 12/03/2013 - 14:30 | Link to Comment James_Cole
James_Cole's picture

Not a pyramid scheme, wink wink nudge nudge.

Tue, 12/03/2013 - 14:34 | Link to Comment Vampyroteuthis ...
Vampyroteuthis infernalis's picture

Next you are going to tell me everything that a Belgian court rules is true.

Tue, 12/03/2013 - 14:51 | Link to Comment Disenchanted
Disenchanted's picture

Like Belgium is HLF's #1 market. LOL!

btw is anyone interested in signing up under me as a distributor? /s

Tue, 12/03/2013 - 15:16 | Link to Comment NoDebt
NoDebt's picture

Bill Ackman.  It's what's for dinner.

"I will never alter my position on Herbalife.  I will not bend or waver.  I will keep getting this 2x4 shoved up my ass for the rest of my life, no matter how much damage it does to me."

I love "true believers" in the investment world.  You know right where they stand, which makes targeting the mortar shells much easier.

Tue, 12/03/2013 - 16:48 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

It's not a pyramid scheme - it's ALIENS -

Tue, 12/03/2013 - 14:12 | Link to Comment Divided States ...
Divided States of America's picture

I cant wait till HLF soars to 83 bucks when the Zimbabwean Court says that HLF's sales model is in compliance with the country's law.

Tue, 12/03/2013 - 13:48 | Link to Comment TheFourthStooge-ing
TheFourthStooge-ing's picture


You would think that confirming its not a ponzi scheme would be bad news in todays ponziconomy.

Yes, it is bad news, but then you have to apply the Bizarro World modification coefficient which, because Obama, makes bad news good news.

I wonder if MDB ever unloaded that garage full of Herbalife stuff he was worrying about earlier this year.

Tue, 12/03/2013 - 16:31 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

I'm sure he safely re-hypothecated the inventory for treasuries!

Tue, 12/03/2013 - 14:00 | Link to Comment thunderchief
thunderchief's picture

Who has a story an Am-Way?

Up goes the the curtain, there is the sign, then there is the click as they lock those auditorium doors. The gasp in the audience and all those people saying the same thing...."Oh for Fucks Sake!"

Don't worry, it's not a pyramid scheme.


Tue, 12/03/2013 - 14:54 | Link to Comment Disenchanted
Disenchanted's picture

re: "Amway"



In 1979 Amway was cleared of being a pyramid scheme in America by a Federal Trade Commission (FTC) investigation, and was subsequently cleared of the same allegations by a Belgian court in 1997


quote from:

Tue, 12/03/2013 - 14:25 | Link to Comment Canadian Dirtlump
Canadian Dirtlump's picture

Given Belgium is an EU nexus of crime and pedophilia, like DC or Ottawa, I would consider anything they say to be the opposite of the truth.


The scandal that was squashed:


If you ever have the time and stomach youtube it. Dutroux Affair.


US ambassador = pedophile:



Tue, 12/03/2013 - 14:35 | Link to Comment Herd Redirectio...
Herd Redirection Committee's picture

I spent almost an entire day one time reading about the Dutroux scandal.  Tough to stomach, and not something I'd care to revisit.

Tue, 12/03/2013 - 14:54 | Link to Comment Canadian Dirtlump
Canadian Dirtlump's picture

You did your duty then informing yourself. Other ones in concert to this wouldbe the Franklin Coverup in Nebraska, and the Dunblane massacre in Scotland. The waking up process is long, hard, and varied - but realizing and digesting that those in power across the developed world are truly monsters or compromised empty vessels in the majority of cases, is the hardest.

Tue, 12/03/2013 - 13:45 | Link to Comment williambanzai7
williambanzai7's picture

The Belgium Court is a Ponzi scheme.

Tue, 12/03/2013 - 13:50 | Link to Comment Fíréan
Fíréan's picture

As "ponzi" is the new norm, all across the board, then therefore there is no "ponzi" anymore.


It's just another shade of grey, in the grey zone.

Tue, 12/03/2013 - 13:58 | Link to Comment tarsubil
tarsubil's picture

Very simple really. Everything is a ponzi and nothing is a ponzi.

Tue, 12/03/2013 - 13:55 | Link to Comment aVileRat
aVileRat's picture

As mentioned before, it is not a crime to exploit underclass lack of financial literacy or business acumen.HLF exploits the language and street cents of underclasses in multiple countries and demographics with their margin juicing, channel stuffing and weak governance on awarding performance incentives. Again, none of that is a crime by law or a definition of a Ponzi scheme.

Is it reprehensible to invest in these companies ? No more than investing in RJR or Armalite. Would HLF suppliers be better off without HLF ? That's a loaded question and can be equally applied to Mary Kay or Tupperware, both of which were accused in their 1980's go-go years of exploiting female financial illiteracy with juicy GORS & inventory pump. In the current form of HLF, the answer is likely yes. But if you remove HLF today, then it will create  a shaky precedent for anyone doing vendor resales to be captured for ponzi.

In short, Bill needs to think what he wants to do with the strategy.

If Bill really wanted to focus his attention, his next target should be on financial literacy itself or target the predatory practices of consumerist conglomerates who exploit it.

The endgame in HLF will likely require

1. Bill needs to get a RICO against HLF proving they enforce or coerce people to maintain their memberships & outlets through deceptive practices.

2. HLF recognizes their appeal is in a 'trusted' brand with underclasses and a larger brand agent such as P&G acquires HLF. Subsequently the HLF is used for pushing nutritional food choices to the outlets, in turn creating a poverty escape outlet for those entrepenuers via health food vendorship.

2 is not rocket science and is well known in The City as the likely objective of a MBO/LBO strategy in 2014.


Tue, 12/03/2013 - 14:02 | Link to Comment HoofHearted
HoofHearted's picture

And when will Bill get the Belgian court to rule on Social Security or Medicare in the U.S.?

Tue, 12/03/2013 - 15:04 | Link to Comment Derf Scratch
Derf Scratch's picture

well said... as i posted many months ago-  who died and made Ackman the new head of the global "better business bureau"? what an arrogant little fuck...

and let's not forget RICO is a disgusting, un-Constitutional gov't power grab 

Tue, 12/03/2013 - 13:59 | Link to Comment max2205
max2205's picture

Hey where is my 2nd pomo?

Tue, 12/03/2013 - 14:02 | Link to Comment El Hosel
El Hosel's picture

If its not a Ponzi scheme why is it up? Sell sell sell.

Tue, 12/03/2013 - 14:19 | Link to Comment Al Huxley
Al Huxley's picture

I believe its 1:30 EST - wait for it..., you'll know its started when the indexes go green.

Tue, 12/03/2013 - 14:18 | Link to Comment krispkritter
krispkritter's picture


Tue, 12/03/2013 - 14:09 | Link to Comment philosophers bone
philosophers bone's picture

So given that Ackman held a press conference and made a public announcement that he had a clear legal opinion that it was a pyramid scheme, and it moved the market downwards (in his favour), is he going to jail? 

Tue, 12/03/2013 - 15:13 | Link to Comment Derf Scratch
Derf Scratch's picture

No, it's clearly ok now to manipulate the mkt. with "public announcements" just ask Icahn...  SEC says it's all kosher...

Tue, 12/03/2013 - 16:54 | Link to Comment philosophers bone
philosophers bone's picture

Yes, although Icahn has changed his story from "an AAPL buy-back will happen according to my conversation with Tim" to "I am talking to Tim about a buy-back".  Big difference which is of course lost on the SEC.

Tue, 12/03/2013 - 14:22 | Link to Comment Derf Scratch
Derf Scratch's picture

need a scorecard of which filthy rich j's are winning vs. losing on this squeeze...

Tue, 12/03/2013 - 14:33 | Link to Comment Kreditanstalt
Kreditanstalt's picture

It's not a question of whether some government/court decides Herbalife is or is not this or that.

The thing is flakey.  It produces nothing, sells nothing, markets air and advice.  HOW it does so is irrelevant: it's built on an era of cheap money junk consumption and will be among the first to fall when reality bites.

Tue, 12/03/2013 - 15:30 | Link to Comment Quantum Darwinism
Quantum Darwinism's picture

"The thing is flakey.  It produces nothing, sells nothing, markets air and advice."

Sounds about the majority of economic activity in "develeped serviced-based" ecnonomies...

Tue, 12/03/2013 - 14:43 | Link to Comment The Reich
The Reich's picture

Bullish on Belgian Bribery Case.

Tue, 12/03/2013 - 15:07 | Link to Comment ebworthen
ebworthen's picture

When Herbalife does finally crumble, Ackman will have a headline he can frame.

He can put it next to the framed picture of his nemesis - Ben Bernanke.

Two framed pictures - cost = $400+ million, value = $5


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