For the first time, the multilevel marketing company, Herbalife Ltd. (NYSE:HLF) spent $1.34 million in 2013 on lobbying in Washington D.C.

Herbalife

According to Michelle Celarier of the New York Post, the amount spent in 2013 dwarfs Herbalife Ltd. (NYSE:HLF)’s typical spending.

Bill Ackman criticized Herbalife’s lobbying efforts

Hedge fund manager Bill Ackman in a new letter to investors this week reiterated his position that the short position of his hedge fund in Herbalife Ltd. (NYSE:HLF) offers “extremely compelling and even greater assymetirc payoff than before because of substantial increase of the price of the stock.”

Bill Ackman of Pershing Square Capital Management L.P. pointed out that: “Herbalife’s response to Pershing Square is unprecedented in the history of short selling.” He noted that the company spent tens of millions of dollars and hired public relations firms, lobbyists, law firms, investment banks, and paid-spokesperson to attack his firm.

Bill Ackman also emphasized that Herbalife Ltd. (NYSE:HLF) should welcome an investigation from the FTC if it is confident that it is not in violation of the law instead of lobbying Congress to stop an inquiry. According to him, a number of former Herbalife employees contacted the hedge fund and shared additional information confirming the illegal business practices of the company.

Herbalife’s lobbying spending exceeds others

Michelle Celarier of the New York Post points out that the multilevel marketing company has long been known for its strong presence in the nation’s capital. However, the $1.34 million it spent in 2013, as of October 28, dwarfs its typical spending, records show. She highlights the previous record was in the election year of 2008 when Herbalife Ltd. (NYSE:HLF) spent $880,000, according to the Center for Responsive Politics.

Herbalife Ltd. (NYSE:HLF) spent $810,000 in 2012. Its 2013 spending exceeds that of other companies in its industry including the biggest MLM, Amway, which spent $330,000 last year. Herbalife’s spending even surpassed pharmaceuticals, whose need for regulatory drug approval keeps them forking over the cash.

For instance, McKesson Corporation (NYSE:MCK) which has a market cap of $37 billion spent only $1.13 million, while Herbalife’s market cap stood at $7.9 billion.

Interestingly, Herbalife Ltd. (NYSE:HLF) also outspent Ackman’s Pershing Square, almost tenfold. Pershing Square had spent $138,000 lobbying this year.