Hedge fund manager Bill Ackman released an internal Herbalife video on Wednesday that he says proves his allegation of fraud.
The video, which is presented as a series of clips on Ackman’s website factsaboutherbalife.com, is from a 2005 Herbalife-sponsored event in Anaheim, Calif.
“The full video, in frank admissions by top Herbalife distributors, underscores that Herbalife is a pyramid scheme,” Ackman’s Pershing Square said in a press release announcing the video.
Ackman has a lot at stake. He has been fighting with the health beverage peddler since December 2012, when the 48-year-old investor publicly declared a short position worth $1 billion.
It’s not been an easy road, however. The stock is down 52% this year, but Herbalife shares rose as high as $81.50 in the wake of Ackman’s short following support for the company from big-name investors such as Carl Icahn.
Icahn, who took an investment in Herbalife following Ackman’s short, now controls five out of 13 seats with the company’s board of directors.
Herbalife shares traded up less than 1% to $37.71 a share in midday trading Wednesday.
Ackman’s video shows senior Herbalife distributor Stephan Gratziani giving a motivational speech that includes some tough talk about the difficulties of getting other people, who may not succeed, to plunk down the money required to sell the product.
“We sell people on a dream business, that they can make it. Yet deep down inside, what do we really know? Yeah. We know that the reality is that most of them aren’t going to make it,” Gratziani says at one point.