As disclosed by the Company’s FORM 10-Q Ffor the quarterly period ended June 30, 2005, in 2002, in July 2002, the court consolidated nine similar actions, and in May 2003, the case was transferred to federal district court in Montana. In May 2004, defendants filed a motion to dismiss plaintiffs’ second amended complaint, and in June 2004, plaintiffs filed their opposition and defendants filed their reply. Defendants have reached an agreement in principle with plaintiffs to settle the federal class action subject to documentation and court approval. Under the proposed agreement, any settlement amount will be paid by the Company’s insurance carrier and will not involve any out-of-pocket payment by the Company or the individual defendants. In light of the proposed settlement, the parties have requested that the hearing on defendants’ motion to dismiss be taken off calendar, without prejudice to their right to reinstate the motion in the event the parties are not successful in negotiating the terms of the final settlement papers.

The original Complaint alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between April 20, 2001 and April 1, 2002, thereby artificially inflating the price of Stillwater securities. Throughout the Class Period, as alleged in the complaint, Stillwater issued a series of materially false and misleading statements regarding its financial performance and filed reports confirming such performance with the United States Securities and Exchange Commission ("SEC"). The complaint alleges that these statements were materially false and misleading because, among other things, (i) SWC improperly classified "mineralized material" as "probable reserves"; (ii) defendants' improper manipulation of probable reserves overstated Stillwater's class period net income because defendants depreciated Stillwater's plant and equipment costs according of the life of these reserves. If defendants had properly accounted for these reserves, depreciation would have occurred much faster; and (iii) the reduction in probable reserves will likely result in an impairment charge, or a restatement of at least fiscal year 2001 results. Furthermore, defendants failed to disclose that the SEC had advised Stillwater by mid-December 2001/ early January 2002 that its methodology for the calculation of probable ore reserves was improper and would have to be changed.

The complaint further alleges that on April 2, 2002, when defendants belatedly disclosed that the Company's accounting practices had been condemned by the SEC, the stock dropped by 24% in one day on extraordinarily high volumes of 4,743,600 shares traded, vastly greater than the Company's average trading volume of approximately 400,000 shares per day. The full extent of Stillwater's losses is still unknown to the market, since the revision to reserves could adversely impact 2001 net income, and result in a downward financial restatement of prior quarters.

On June 2, 2003, a Consolidated Amended Complaint for Violation of the Securities Exchange Act of 1934 was filed by the lead plaintiffs against the defendants.

On December 17, 2007, an Order and Final Judgment was issued pursuant to Stipulation of Settlement of Class Action in favor of PGM Associates LP, Sunshine Wire and Cable Defined Benefit Pension Plan Trust against Stillwater Mining Company.