(FORTUNE Magazine) – It's hardly unusual for some big-foot Wall Street investor to buy or short a huge chunk of a company's stock and then start making noise about it. Happens every day. What is unusual is for two of these powerballs to get into the same stock--one long and one short--and then start going after each other. Unusual and a whole lot of fun, actually. And that's exactly what's happening right now to Conseco, the Indiana insurer, which has become a veritable piece of meat set upon by two of the most aggressive wheeler-dealers around: Irwin Jacobs (he's long) and Carl Icahn (he's short).

What's truly amazing is that these two guys are so absolutely certain of their respective--and completely opposite--takes on Conseco. After speaking with them, you'd literally have to ask yourself if they're talking about the same company. It's a Rashomon, Kurosawa fans, to beat all Rashomons.

"I just don't think Irwin understands this one," Icahn says to me recently. "I don't understand this?" snorts Jacobs to me over the phone. "He's the one who said he didn't need to do any work on it." Icahn: "He's trying to orchestrate a short squeeze." Jacobs: "Are you kidding me? I've owned the stock for over a year." And so on.

As if that weren't enough--and believe me, a war between Jacobs and Icahn is a yarn enough in itself--the Conseco story doesn't stop there. There's the reincarnation of Gary Wendt, once the kingpin of GE Capital, now Conseco's embattled CEO. (Wendt feels like "a medicine ball being tossed back and forth," his spokesman says.) There's also the public bashing of a Wall Street analyst in a huge, half-page ad in the Wall Street Journal. We even have the not-so-fine art of bass fishing playing a minor role, as well as "the legendary actor and entertainer" Dick Van Dyke! (Has anyone nailed down the screen rights to this?!?)

Before we get back to Carl vs. Irwin, a little history. Conseco, for years the hot burrito of the insurance biz, was built by flashy entrepreneur Steve Hilbert. His modus operandi was to buy smaller insurance operations and fold them into his company--essentially a roll-up model. It appears, however, that Hilbert's ambition outpaced his expertise, especially when he bought Minneapolis-based mobile-home lender Green Tree for $6.7 billion in early 1998. Green Tree's business--which now accounts for 30% of Conseco's revenues--was sucking up cash and plagued by controversial accounting practices. Eventually, Green Tree, renamed Conseco Finance, almost took the company down. By May 2000, CNC had fallen from a high of $57 to four bucks and change. Hilbert was removed, and the board cast about for a new CEO/savior. (See "A Deal Too Far" in the Fortune.com archive.)

Enter Gary Wendt. You remember him, right? Wendt was the head (and really the architect) of GE Capital, that vaunted and complex moneymaking machine so vital to Jack Welch's amazing success. But even with Wendt's achievements at GE Cap, he was not in the final running to take over for Jack (some say this was due in part to his very messy divorce from wife Lorna--see "It's Her Job Too" in the Fortune.com archive.)

In any event, Wendt was "open to new opportunities," as the headhunters say, when Conseco came calling last June. Jacobs, by the way, says he played a key role in brokering the deal that got Wendt the job. (Interesting note: Apparently to free Wendt from his noncompete with GE, Conseco issued a warrant to GE to purchase 10.5 million CNC shares at $5.75 each--a wad that is now worth $125 million. Nice trade, Jack!)

Wall Street greeted Wendt's hiring with some major fireworks. CNC shares doubled on the news--though they soon dropped back into single digits and stayed there until December. Wendt reportedly was already familiar with Conseco--he had looked at Green Tree when it was for sale years earlier--but even he admitted the job was tougher than he anticipated. The mobile-home business was a mess, and insurance wasn't pretty either. Ratings for Conseco's debt were poor, and that made borrowing--the lifeblood of this business--excessively expensive. Plus, Hilbert had invested in all sorts of weird stuff: a riverboat casino, some French rococo art, and various pieces of real estate. And there were layers of ineffectual management as well as huge loans to board members. Wendt went to work: He stripped away management, sold off paintings, got rid of the riverboat, and used an obscure Indiana law to purge the board of its recalcitrant members. Rating agencies ratcheted up their outlook on the company. By early 2001 the stock had shot into the high teens.

Enter Carl Icahn. Short-sellers have been in CNC since the Green Tree days, but Icahn is a whole different animal. He has billions of dollars of personal wealth, and though he's lost his share of dust-ups (notably, TWA and Marvel Comics), he is razor-sharp. Most of all, he is relentless. (He battled RJR for four years before the company split up.) Icahn, you could say, is forever.

I recently dined with Icahn at Morton's steakhouse in New York. (Really due diligence for him, as he is also helping to back a hostile takeover of that chain.) Icahn, who's short many millions of CNC shares, was his usual voluble self. "This is the most certain thing I am doing right now," he says, sipping on a martini. The market has been seduced by the power of Gary Wendt, he says. No way, he insists, is the company worth $13 billion (the total of its $6 billion in equity plus its outstanding debt). "The company was worth only a very small fraction of that when Wendt came in--how could it be worth so much more now?" he asks me. (And to a waiter: "How about some bearnaise sauce with this?")

More than that, Icahn says, delinquency rates and repos in the company's mobile-home business are a hidden time bomb. To prove it, one of Icahn's lieutenants, Vince Intrieri, pushes a piece of paper across the table. They tell me it's a chart with numbers from Moody's showing Conseco's problem loans over the past year. Icahn says he believes "they are repossessing these mobile homes and then reselling them out to some guy who is in even worse shape." Icahn also points to a practice called "default transfer of equity," in which a delinquent loan and the mobile home it is attached to are repackaged for sale to a new buyer and then removed from Conseco's list of delinquent loans. TheStreet.com recently ran a piece on this practice, citing two confidential sources who say that Conseco is increasingly turning to this tactic, and that eventually these resold loans will turn bad too. We'll see.

For Jacobs this is all laughable. "Are these customers the best credits in the world? No. But all of this delinquency and repossession has been figured in to the models." Jacobs says he owns "just under 5% of [Conseco's] stock," right below the threshold where he would have to report it to the SEC. Once known as "Irv the Liquidator," Jacobs has mellowed over the years. Some. He's still waging a vocal battle with the shorts (though not with Icahn in this case) over software-maker AremisSoft. He's big into boats--he owns Genmar. And bass fishing. (That goes with the boats.) In fact, he owns Operation Bass, which he is trying to turn into the Nascar of fishing. So perhaps I shouldn't have been surprised when Conseco recently announced it had entered into a "marketing partnership with Operation Bass." Nice, huh?

Anyway, Jacobs expresses supreme confidence in the CEO who, remember, he helped bring in. "A.M. Best has raised its rating, the banks have signed off on the company's goodwill, the stock price is up, and earnings are up. It's a work in progress, but there is progress," he says. (For more on why he's sure he's right on this one, check out www.irwinljacobs.com.)

Another player caught in the middle of the back-and-forth between Icahn and Jacobs is Salomon Smith Barney analyst Colin Devine, who correctly predicted back in 1998 that Green Tree would crater Conseco. Devine continues to question the company's financials, even after the hiring of Wendt. Icahn cites Devine's research when slamming Conseco. On Monday, May 7, Devine issued a report saying that half of Conseco's Q1 earnings had come from one-time gains--growth he says is not sustainable. The next day, Conseco issued a press release blasting Devine. Then on Monday, May 14, Jacobs took out the big newspaper ad saying that the analyst "deserves an Academy Award for Best Actor in ineptness and/or desperation." Not a fun day for Devine.

Around that time, the action between Jacobs and Icahn heated up. First, at a charity event in New York, Icahn compared Conseco with Priceline, a stock he had made millions shorting. Then, in the Minneapolis Star Tribune, Jacobs called Icahn "desperate," for making disparaging remarks about Conseco. Jacobs also said that if Icahn was planning to short more stock, he should phone him. Icahn did, offering to sell Jacobs large quantities of Conseco stock. Icahn never did a deal directly with Jacobs. But he did make a trade--with a broker with whom Icahn says Jacobs said he has ties. Got that straight?

Meanwhile, back at Morton's, my dinner with Carl is now well into its second hour, but Icahn is just getting warmed up. "Conseco is considering a stock offering, which I think could be as ill-conceived as one of those failed dot-com underwritings," he says over a glass of Grand Marnier. Icahn believes shareholders will end up holding the bag.

Hogwash, says Jacobs. As for Wendt: "The only thing we know for sure is that anyone who is short will have to buy the stock sometime. I like that."

As with any business megadrama, a lot is riding on all of this. Perhaps the one with the most at stake is Wendt. If he manages to pull this off, he will ride into the sunset a wealthy hero. If not, well, he'll still be wealthy, but without the legacy. Not only will he have failed at Conseco, but if Icahn is right and Conseco's turnaround is an illusion, it could call into question Wendt's success at GE Capital. As in, just how much number-juggling went on back then, anyway? Over the next year or so we will find out who's right in this battle of the titans, Jacobs or Icahn. This war won't break the bank for either of 'em, but believe me, they're both dying to win it.

Oh, as for Dick Van Dyke, it turns out that last month Dick was named official spokesman of Conseco's Bankers Life unit. Even ol' Rob Petrie couldn't script this one better!