UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 8, 2023 (
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| Item 8.01. | Other Events. |
As previously disclosed by Scilex Holding Company (the “Company”), on March 12, 2021, Sorrento Therapeutics, Inc. (“Sorrento”), the Company’s controlling stockholder, and Scilex Pharmaceuticals Inc., a wholly owned subsidiary of the Company (“Scilex Pharma”), filed an action (the “Action”) in the Court of Chancery of the State of Delaware (the “Chancery Court”) against Anthony Mack, former President of Scilex Pharma, and Virpax Pharmaceuticals, Inc. (“Virpax”), a company founded by Mr. Mack, alleging, among other things, breach by Mr. Mack of his non-compete agreement with Sorrento, breach of fiduciary duty, and tortious interference by Virpax with that non-compete agreement. The case was tried from September 12, 2022 to September 14, 2022.
On September 1, 2023, the Chancery Court issued a memorandum opinion addressing liability in the Action (C.A. No. 2021-0210-PAF). The Chancery Court found it proper to attribute Mr. Mack’s knowledge and actions to Virpax, which Mr. Mack used to effectuate the tortious interference and breach of fiduciary duty. The Chancery Court found that (i) Mr. Mack (a) breached the restrictive covenants agreement he entered into with Sorrento (the “RCA”) by developing Epoladerm; (b) breached his fiduciary duty of loyalty to Scilex Pharma; and (c) misappropriated certain Scilex Pharma trade secrets; and (ii) Virpax (a) is liable for tortious interference with the RCA; (b) aided and abetted Mr. Mack’s breach of his fiduciary duty of loyalty to Scilex Pharma; and (c) misappropriated certain Scilex Pharma trade secrets. Sorrento and Scilex Pharma waived their claims for breach of Mr. Mack’s employment contract and for tortious interference with prospective economic advantage.
Although the Chancery Court found in favor of Sorrento and Scilex Pharma (on all but three counts deemed to have been waived), no ruling was made as to an appropriate remedy. Sorrento and Scilex Pharma are seeking a combination of equitable and monetary relief, including an injunction, extension of the RCA, damages, constructive trust and/or a reasonable royalty on the revenues that may eventually be generated by the products that were the subject of the Action. The parties to the Action are required to submit to further proceedings to determine the remedy that most appropriately implements the rulings set forth in the Chancery Court’s opinion.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
| Exhibit Number |
Description | |
| 104 | Cover Page Interactive Data File, formatted in Inline Extensible Business Reporting Language (iXBRL). | |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| SCILEX HOLDING COMPANY | ||
| By: | /s/ Elizabeth Czerepak | |
| Name: | Elizabeth Czerepak | |
| Title: | Chief Financial Officer and Chief Business Officer | |
Date: September 8, 2023
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