8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 27, 2006

CRAY INC.

(Exact name of registrant as specified in its charter)

Washington
(State or other jurisdiction of
incorporation or organization) 0-26820
(Commission
File Number) 93-0962605
(I.R.S. Employer
Identification No.)

411 First Avenue South, Suite 600
Seattle, WA 98104-2860
(Address of principal executive offices)

Registrant’s telephone number, including area code:	(206) 701-2000
Registrant’s facsimile number, including area code:	(206) 701-2500

None
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01 Regulation FD Disclosure

A copy of our May 2, 2006, press release relating to the dismissal of securities class action and derivative action filed in the U.S. District Court for the Western District of Washington is furnished as Exhibit 99.1 to this Form 8-K.

Item 8.01 Other Matters

On April 27, 2006, Judge Thomas S. Zilly of the U.S. District Court for the Western District of Washington dismissed both the consolidated class action litigation filed against us and certain of our present and former officers and directors, and the consolidated derivative litigation filed against our present and former officers and directors, subject to the right of the plaintiffs to file amended complaints.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

99.1 Press Release of Cray Inc., dated May 2, 2006, relating to the dismissal of securities class action and derivative action filed in the U.S. District Court for the Western District of Washington.

          The information in Item 7.01 of this Form 8-K and Exhibit 99.1 attached hereto are furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

May 2, 2006

Cray Inc.
By:	/s/ Kenneth W. Johnson
	Kenneth W. Johnson
	Senior Vice President and General Counsel

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EX-99.1

Exhibit 99.1

Cray/Media:	Investors:
Steve Conway	Victor Chynoweth
651/592-7441	206/701-2094
sttico@aol.com	vic@cray.com

FEDERAL DISTRICT COURT DISMISSES SECURITIES CLASS ACTION AND
DERIVATIVE LITIGATION

SEATTLE, May 2, 2006 — Cray Inc. (Nasdaq NM: CRAY) today reported that on April 27, 2006, Judge Thomas S. Zilly of the U.S. District Court for the Western District of Washington dismissed both the consolidated class action litigation filed against the Company and certain of its present and former officers and directors, as well as the consolidated derivative litigation filed against the Company’s present and former officers and directors.

The class action against the Company and five of its present and former officers and directors initially filed in May 2005 alleged that the defendants had violated the securities laws by knowingly making false or misleading statements to the public. Judge Zilly, in a 49-page opinion, found that plaintiffs failed to plead adequately that defendants intentionally or recklessly made false statements (acted with scienter), and failed to plead adequately that many of the statements made by defendants were false. Judge Zilly also ruled that plaintiffs failed to plead adequately that plaintiffs’ alleged losses were caused by some of defendants’ actions. The Court gave the class action plaintiffs 120 days to file an amended complaint should they choose to do so.

Judge Zilly, in a separate 33-page decision, dismissed without prejudice the derivative litigation initially filed in June 2005, finding that plaintiffs had failed to make a demand on the Company’s Board of Directors before filing the case and failed to plead adequately why a demand would have been futile. Judge Zilly also dismissed with prejudice claims of breach of fiduciary duty and unjust enrichment based on alleged insider trading and in addition dismissed certain claims without prejudice on the additional grounds that the plaintiffs did not allege fraud and misrepresentation with the required specificity and failed to plead recoverable damages.

The Company and the individual defendants are pleased with the Court’s decision.

About Cray Inc.
As the global leader in high performance computing (HPC), Cray provides innovative supercomputing systems that enable scientists and engineers in government, industry and academia to meet both existing and future computational challenges. Building on years of experience in designing, developing, marketing and servicing the world’s most advanced supercomputers, Cray offers a comprehensive portfolio of HPC systems that deliver unrivaled sustained performance on a wide range of applications. Go to www.cray.com for more information.

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Cray is a registered trademark of Cray Inc.

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