A software project which has been forced to cease operations due to legal action.
The very first Foxed project was "Aliens Quake". 20th Century Fox forced users to stop distributing the software on the grounds that it infringed on their IP. Since the introduction of the DMCA many other proejcts have beeen Foxed including the DeCSS DVD cracking software.
See: "A Jail of Two Cities" interview of Dave "WhiteNoise" Wallin by Fragmaster@planetquake
Open-source advocates hope that the MONO project is not Foxed by Microsoft.