Hailed as a master investor, he clinched his highflier status in the fall of 2014 by paying $90 million with some friends to buy the penthouse at One57, a 13,500-square-foot aerie in Midtown Manhattan overlooking Central Park. He didn't plan to live there -- it was an investment property -- but until he sold it, the apartment would make a good party space, he told The New York Times. If Mr. Ackman were a stock, that might have been his peak.

Today, things are very different for him. His company's performance is way down, he is in the midst of an expensive divorce, and on March 13, he and investors in funds run by Pershing Square Capital Management swallowed a $4 billion loss on Valeant Pharmaceuticals International, a beleaguered drug company.


while his funds notched an exceptional 40 percent gain in 2014 -- much of it attributable to the Allergan trade that has drawn the lawsuit -- Mr. Ackman's funds lost 13.5 percent last year and 20.5 percent in 2015. Through March 15, Pershing Square is flat.


One reason so many on Wall Street have been riveted by Mr. Ackman's wrong-way Valeant bet is that it seems to confirm an age-old investing truth: Karma has everyone's address. For example, Mr. Ackman's $4 billion loss in Valeant more than wiped out the $2.2 billion he made in 2014 on Allergan.


As [the Valeant] calamity played out, Mr. Ackman was also fighting the Allergan lawsuit in California. The plaintiffs were investors who had missed out on gains in Allergan stock in 2014 because they had sold shares without knowing about Valeant's impending bid, while Pershing Square, which did know about it, was buying Allergan shares. They contended that Valeant and Pershing Square violated securities laws, which prohibit fraudulent, deceptive or manipulative actions in connection with a tender offer.

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