Ixchel Pharma, LLC v. Biogen, Inc.

Forward Pharma (Forward) and Ixchel Pharma, LLC (Ixchel) (plaintiff) contracted to collaborate in developing a new drug incorporating dimethyl fumarate (DMF). The collaboration was likely to be economically advantageous to both firms. The contract was terminable at any time on 60 days’ notice. Shortly thereafter, Forward and Biogen, Inc. (defendant) agreed to settle a patent dispute involving another DMF-based drug. The agreement required Forward to stop doing any DMF-related work with Ixchel. Forward complied by giving Ixchel the requisite 60-day termination notice. Ixchel sued Biogen for tortious interference with the Forward-Ixchel contract. A federal district court dismissed the suit. However, the court allowed Ixchel to amend its complaint to allege that Biogen interfered not only with the Forward-Ixchel contract, but also with Ixchel’s prospective economic advantage, which Biogen accomplished by tortiously restraining Forward’s ability to trade with Ixchel. The district court once again dismissed the suit. Ixchel appealed to the Ninth Circuit, which certified to the California Supreme Court the question whether a plaintiff must plead an independent wrongful act to state a claim for tortious interference with a contract terminable at will. As a follow-up question, the Ninth Circuit asked whether a restraint of trade could constitute such an independent tort.