Herbalife Ltd. (NYSE:HLF) came out ahead of expectations for the second quarter, and shares are soaring, although there’s at least one investor who’s probably quite unhappy right now. Hedge fund manager and activist investor Bill Ackman is seeing his paper losses increase as the price of the stock continues to rise this morning.

herbalife

Herbalife spent millions taking on Ackman

Ackman has been trying to chip away at Herbalife Ltd. (NYSE:HLF)’s reputation since he announced his large short position in the company late last year. He called the company a pyramid scheme, although it vehemently denies that accusation. In fact, management is almost thanking Ackman this morning for bringing the company into the public eye.

Herbalife disclosed on its earnings report that it spent more than $15 million defending against the claims of “a short seller,” a.k.a., Bill Ackman. This morning though, Herbalife President Des Walsh told Reuters that the public debate over the company’s business model actually helped its June quarter results.

“Despite all the noise on Wall Street, we saw a record number of 80,000 new distributors in the U.S. in the second quarter,” Walsh told Reuters. “Now, more people who are aware of what’s happening have taken time to understand our business, and with that comes an acknowledgement of the legitimacy of our products.”

Bill Ackman vs. Carl Icahn

Ackman made a $1 billion bet against Herbalife Ltd. (NYSE:HLF), and sources have indicated that he hasn’t moved to cover that position yet. His paper losses amounted to about $200 million before the company’s stock shot up in the wake of its June quarter earnings report. Shares rose as much as 8 percent in premarket trading on Tuesday.

Carl Icahn, another activist investor, stepped into the public debate over Herbalife Ltd. (NYSE:HLF) and cast his lots in favor of the company and against Ackman. This morning Icahn is undoubtedly smiling while Ackman fumes over his increasing losses.