{"url_path":"/sec/ppta/10-q/2026/item-1","section_key":"item-1","section_title":"Item 1 Legal Proceedings.","topic":"sec","document":{"doc_type":"10-Q","doc_date":"2026-05-11","source_url":"https://www.sec.gov/Archives/edgar/data/1526243/0001104659-26-058253-index.html","accession_number":"0001104659-26-058253","cik":"0001526243","ticker":"PPTA","issuer_name":"PERPETUA RESOURCES CORP.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1526243/0001104659-26-058253-index.html","primary_entity_key":"0001526243","primary_entity_name":"PERPETUA RESOURCES CORP."},"word_count":1814,"has_tables":true,"body_markdown":"Item 1. Legal Proceedings.\n\nThe Corporation and its subsidiaries have been parties to an ongoing legal proceeding with the Nez Perce Tribe for claimed violations of the CWA allegedly linked to historical mining activities. In August 2019, the Nez Perce Tribe filed suit against the Company in the United States District Court for the District of Idaho. The Company filed an answer generally denying liability and later, the court allowed the Company to amend and file a third-party complaint against the USFS. The Company also filed a separate CWA citizen suit against the USFS alleging that several of the point source discharges, as alleged by the Nez Perce Tribe in its complaint, were occurring on lands owned and controlled by the United States government.\n\nPursuant to the terms of the voluntary ASAOC executed in January 2021 with the U.S. EPA and the USDA under the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), the Company agreed to dismiss its pending action in the CWA case against the USFS without prejudice. On August 8, 2023, the Company and the Nez Perce Tribe filed the Settlement Agreement to resolve the Tribe’s CWA claims. The parties jointly asked the court to approve the Settlement Agreement and dismiss the case without prejudice. The Settlement Agreement provides for total payments of $5.0 million by Perpetua over a four-year period. This includes $4.0 million of contributions by Perpetua to the Fund to be used by the Nez Perce Tribe to support water quality improvement projects in the South Fork Salmon River watershed and $1.0 million of reimbursements to the Nez Perce Tribe for legal expenses. Following a 45-day review period by the United States Justice Department and the U.S. EPA, the U.S. District Court for the District of Idaho approved the Stipulation for Dismissal and entered a Judgment on October 2, 2023, which resulted in the CWA lawsuit being dismissed without prejudice. Under the Settlement Agreement, the Company anticipates that a dismissal with prejudice will be entered after completion of Perpetua’s required payments. All required payments to date have been made timely pursuant to the terms of the Settlement Agreement. As of March 31, 2026, the current portion of the settlement was $1.0 million with the remaining $1.0 million classified as long-term.\n\nCertain of the Company’s property interests in the Project site are also subject to existing judicial consent decrees entered into by third parties and various governmental entities with respect to contamination caused by historical mining activities on or near the Project site. These consent decrees, which impose environmental liability and remediation responsibilities on third parties, apply to certain mining claims and mill sites acquired by Perpetua from those third parties. Under the consent decrees, Perpetua is required to grant access to certain Project site areas by regulatory agencies and allow remediation activities to proceed if necessary and to preserve the integrity of previous response actions. Several of the Company’s patented claims in the Hangar Flats and Yellow Pine properties are also subject to a consent decree which requires Perpetua to cooperate with the U.S. EPA and the USFS to implement appropriate response activities.\n\nAdditionally, following the USFS’ publication of the FEIS and ROD approving the Modified Mine Plan for the Project, a lawsuit was filed against the USFS, the USDA and other federal agencies on February 18, 2025 in the United States District Court for the District of Idaho by a number of environmental advocacy groups, including Save the South Fork Salmon, the Idaho Conservation League and other non-governmental organizations, alleging violations of NEPA and other federal laws in the regulatory process (“Federal Environmental Case”). Among other remedies, the claimants seek to vacate the ROD, Final Biological Opinions and other Project approvals and enjoin any further implementation of the Project. PRII filed a motion to intervene in this lawsuit, which was granted by the district court on April 2, 2025.\n\nOn August 29, 2025, the Nez Perce Tribe filed a lawsuit against the USFS, United States Department of Agriculture, and other federal agencies in the United States District Court for the District of Idaho the challenging the USFS ROD and other approvals by the USFS and other federal agencies in connection with the Stibnite Gold Project and alleging violations of NEPA and other federal statutes, regulations, and requirements in the regulatory review and approval process for the Project (“Federal NPT Case”). Among other remedies, the Tribe seeks to vacate the USFS ROD and other regulatory approvals, and to enjoin any further implementation of the Project. PRII filed a motion to intervene in this lawsuit, which was granted by the District Court on September 4, 2025.\n\nThe U.S. District Court on October 2, 2025 issued a general order staying all civil cases listed in the order due to the partial shutdown of the federal government over appropriations for the government. The list included the Federal Environmental Case and Federal NPT Case. This stay did not affect the validity of the USFS ROD or any of the other approvals challenged in either of these lawsuits in connection with the Stibnite Gold Project, and all such approvals remain in effect. After the partial shutdown of the federal government ended, the U.S. District Court lifted the stay and new scheduling orders were entered in both of these lawsuits challenging the ROD and other approvals of the Project issued by federal agencies. The scheduling order in the Federal Environmental Case required all dispositive motions and briefs to be filed by all parties before the end of January 2026. These motions and briefs have been filed.\n\n33\n\n[Table of Contents](#TOC)\n\nThe District Court has not ruled on any of the dispositive motions filed by the parties. The scheduling order in the Federal NPT requires all dispositive motions and briefs to be filed by all parties. before the end of June 2026. These two lawsuits remain pending.\n\nOn May 8, 2026, the plaintiffs in the Federal Environmental Case filed a motion for a preliminary injunction seeking to delay certain planned construction activities for the Project. The plaintiffs’ motion expressly excluded early works construction activities that were contemplated under previously agreed stipulations between the plaintiffs and the Company that are described in the NEPA Permitting Activities section, and these early works activities remain ongoing. A decision from the Court on the motion is expected swiftly as plaintiffs in their motion requested a decision by May 30, 2026, and the Court has set a hearing on the motion for May 28, 2026. The Company believes that this motion and the underlying lawsuit are without merit and intends to vigorously oppose the motion. The Company, however, cannot predict the outcome of the Court’s decision. If the requested relief is granted, it could delay or restrict further implementation of the Project.\n\nAs to the merits of the Federal Environmental Case and the Federal NPT Case, the Company believes the USFS ROD and other federal regulatory processes challenged in these lawsuits were conducted thoroughly and completely by the relevant federal regulatory agencies. However, the District Court has not yet ruled on these lawsuits, and the Company cannot predict the outcome or timing of the Court’s ultimate decision on the merits, or in any interim proceedings, in the Federal Environmental Case or the Federal NPT Case. There can be no assurance that the Project approvals challenged in those two lawsuits including the pending motion for a preliminary injunction in the Federal Environmental Case.\n\nOn March 20, 2025, a putative federal class action lawsuit was filed in the United States District Court for the District of Idaho against the Company and certain of its current officers and directors, on behalf of a proposed class of purchasers of the Company’s common shares during the period from April 17, 2024 to February 13, 2025, inclusive. The claim, captioned Barnes et al. v. Perpetua Resources Corp. et al., Case No. 1:25-cv-00160, alleges that the defendants violated Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder by making false and/or misleading statements during the period from April 17, 2024 to February 13, 2025 regarding the Company’s expected capital expenditures for the Stibnite Gold Project. On June 6, 2025, two new plaintiffs filed a joint stipulation seeking to be appointed co-lead plaintiffs, which was granted by the District Court on June 16, 2025. The plaintiffs filed an amended complaint on August 15, 2025. The amended complaint seeks unspecified compensatory damages. The District Court has issued a scheduling order in this case requiring various procedural and substantive motions to be filed by the parties prior to the end of 2025. The defendants filed a motion to dismiss the plaintiffs’ amended complaint on September 30, 2025 and all briefs by all parties associated with that motion have been submitted. The District Court has not yet ruled on the defendants’ motion to dismiss, and this lawsuit remains pending. The Company believes this lawsuit is without merit and intends to vigorously defend itself. However, in view of the uncertainties inherent in litigation, the Company does not express a judgment as to the outcome of this litigation.\n\nThe Idaho Board of Environmental Quality (“IBEQ”) published an order on May 27, 2025 upholding the air permit to construct (“PTC”) issued for the Project by the Idaho Department of Quality (“IDEQ”) in June 2022 and denying certain petitioners’ appeal from various administrative proceedings with respect to the PTC. The IBEQ on June 27, 2025 denied the petitioners’ motion for reconsideration. Thereafter, the petitioners filed a petition for judicial review in the Idaho state district court for the County of Ada against the IBEQ and IDEQ seeking to set aside the PTC as violative of applicable law and challenging the decisions of the IBEQ upholding the PTC. IDEQ and the IBEQ subsequently moved to dismiss the complaint on procedural grounds, and the court denied that motion and allowed the petitioners to amend their petition. The petitioners’ amended petition, which named the Company as well as IDEQ and the IBEQ as defendants, was served on the Company on or about September 23, 2025. The court subsequently entered an order dismissing the Board as a party and requiring all briefs of the parties to be filed by an outside date of January 16, 2026. All briefs from all parties were submitted by this date. The court has not yet ruled on the parties’ pending dispositive motions. The Company believes that the IDEQ and the IBEQ properly followed Idaho law in issuing the PTC. However, there can be no assurance that the PTC will be upheld upon judicial review.\n\nSee *“Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Ancillary Permitting Update”*above for additional information relating to certain administrative challenges that have been initiated under Idaho law and are pending with respect to certain regulatory approvals issued by the Idaho Department of Environmental Quality.\n\n​\n\n34\n\n[Table of Contents](#TOC)"}