HP, Gateway Settle Patent Fight

HP said late Wednesday that it had settled a nearly two year-old fight with Gateway and its subsidiary eMachines over patent infringement. Under the terms of the deal, Gateway would pay $25 million to HP, followed by an additional $22 million to be paid no later than one year after the final agreement is signed.

The two sides would also agree to drop all litigation filed against each other, and agree to cross license their patents. HP had sued Gateway and eMachines in 2004 and 2005, claiming infringement on 27 patents. Gateway then countersued, accusing HP of infringement on 13 of its own patents.