I've seen my foxface shed his "skin" more than once, it's kinda creepy to see. The first time I saw it I thought he was a goner, but since then I've seen at least a couple other RC members mention this as not being uncommon for this species.
My fish seems to be no worse the wear for this happening, I've had him for a couple of years now and he's the biggest/fattest fish in the tank.