Microsoft Settles With Gateway for $150 Million

Microsoft Corp. will pay computer maker Gateway Inc. $150 million over four years to end a long-running legal dispute, and Gateway said it would use the money to market and develop products that run Microsoft software.

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

To account for the settlement, Redmond, Wash.-based Microsoft said it would take a $123-million pretax charge in the quarter ended March 31. The company also plans to take a pretax charge of $41 million for an earlier settlement with Burst.com. And it will take an additional $550-million charge to reserve funds for other antitrust matters, such as its ongoing legal wrangling with digital media rival RealNetworks Inc.

The deal marks the latest in a series of agreements Microsoft has reached to put various antitrust claims behind it.

Over the last two years, Microsoft has spent about $3 billion to settle private antitrust lawsuits filed by Time Warner Inc., Sun Microsystems Inc., Be Inc. and Novell Inc.

Microsoft still faces some antitrust hurdles.

The Novell settlement relates to antitrust claims regarding its NetWare product. Less than a week after reaching that deal, Novell filed a lawsuit regarding WordPerfect, a product Novell used to own.

Microsoft also has been sued by Seattle-based RealNetworks and is currently appealing a more than $600-million European Union antitrust ruling against it.

Gateway shares rose 8 cents to $4.16 on Monday on the New York Stock Exchange. Microsoft shares rose 3 cents to $24.97 on Nasdaq.