Gateway Getting $150 Million From Microsoft

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Microsoft Corp. has agreed to pay Irvine-based PC maker Gateway Inc. $150 million over four years to settle a legal dispute, and the companies will work together to develop and market Gateway products.


As part of the settlement announced Monday, Gateway will release all antitrust claims against Microsoft based on past conduct.


Gateway said on Monday it expects to spend the money on marketing, including advertising, sales training and consulting. Some also could go toward research, development and testing of products running Microsoft software.


Gateway’s claims arose from the United States v. Microsoft antitrust case in the mid-1990s, where Gateway was identified in U.S. District Judge Thomas Penfield Jackson’s findings as having been impacted in its business by practices on which he ruled against Microsoft.


Gateway, which moved to Irvine from San Diego County last year, is in the midst of a turnaround bid led by Chief Executive Wayne Inouye. Early last year, Gateway bought Irvine’s eMachines, a discount PC seller that Inouye had brought back to life.


In a twist, Inouye ended up running Gateway, taking over from founder Ted Waitt. Since becoming chief, Inouye has closed Gateway stores and cut some 5,000 jobs.



*Michael Lyster from the Orange County Business Journal contributed to this story.

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