Gateway Pays To Settle HP Patent Suits

Gateway Inc. has agreed to pay $47 million to rival computer maker Hewlett-Packard Co. to settle a series of lawsuits over patents.

The two companies also entered into a cross-licensing agreement that lasts for seven years, said Joe Beyers, Hewlett-Packard's vice president of intellectual property and licensing.

The agreement was announced Wednesday, and Beyers said it would probably become official in the next week. It settles a series of lawsuits and countersuits that began in 2004, when HP claimed in San Diego federal court that five of its patents were being infringed by Gateway.

Over the coming months, HP filed additional suits, including one with the International Trade Commission, claiming that at least 27 of its patents were being breached.

Gateway responded with several countersuits that claimed 13 of its patents were being infringed.

The patents protect a broad range of technologies, including power management in notebook computers, manipulation of PC cursors, keyboard functions and management of PC peripherals.

Under the agreement, Gateway will pay $25 million to Hewlett-Packard within seven business days of the agreement becoming final and the remaining $22 million within a year.