Bill Ackman just took a $200 million hit to his reputation

Valeant’s stock dipped ever so slightly on the news. The real loser here is Ackman, whose reputation as a Wall Street wunderkind has taken hit after hit since he teamed up with Valeant and its former CEO, Michael Pearson in 2014. In his business, sometimes money can last longer than an even more important currency — being right.

And after the series of years Ackman has had he needs to be right about something (anything), soon — or resign himself to watching his capacity to move the market with a single word fade to nothing.

You’ll recall why this insider trading suit, brought by investors in pharmaceutical firm Allergan, came about in the first place.

During a 2014 hostile takeover attempt, instead of buying Allergan outright, Valeant secretly teamed up with Ackman, who himself purchased a large chunk of Allergan shares.

Ackman’s stake was disclosed alongside Valeant’s hostile takeover offer, and — surprise! — the billionaire said he would vote his newly acquired Allergan shares in support of the sale to Valeant.

Ackman then pulled out theactivist-investor playbookto pressure Allergan to accept an offer from Valeant. He wrote nasty letters describing Allergan’s “incredibly inappropriate” behavior as it sought to fend off the takeover by a company that was known for slashing research-and-development spending and jacking up drug prices.

That didn’t work.

Allergan was eventually rescued by a white knight and Ackman — still an Allergan shareholder — made a bundle (about$2.6 billionby one count). Valeant profited a great deal too, because its deal with Ackman meant it got a portionof his profits.

The rest is investment history. Ackman, who hadn’t invested in Valeant during the Allergan attempt, became one of its biggest shareholders. So Pershing Square was one of the biggest losers when high-flying Valeant collapsed 90% from 2015 to 2016 after fraud was discovered at the company.

Now, in 2017, Ackman will pay the lion’s share to settle insider-trading claims. It’s understandable — trial would be arduous, expensive, and likely embarrassing. It would only turn what has been a difficult year for Pershing into something of a disaster. In November, the firm lost its proxy battle for three seats on the board of the data-processing company ADP, with the company saying only 20% of shareholders supported him.

Shareholders simply weren’t buying what Ackman, a hero of the financial crisis, was selling.

According to Pershing’s press release, the fund will only take a 1.32% hit to its net asset value, but none of this will help Ackman’s reputation.

Everyone on Wall Street has seen companies skate by and avoid taking responsibility for reprehensible behavior. And everyone walking planet earth has heard this before:

“We continue to believe the case had absolutely no merit,” said Pershing Square CEO Bill Ackman in the company’s release. “We decided, however, that it was in the best interest of our investors to settle the case now instead of continuing to spend substantial time and resources pursuing the litigation.”

Again, that’s all very fair. But on Wall Street settlements like this are paid for in more than money. Imagine the market like a high school cafeteria — hedge fund billionaires, I promise you, aren’t much better than mean girls.

The next time Ackman walks in to grab a PB&J, everyone will probably stop talking. And not in a good way.