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HP seeks Texas justice; Gateway dinged

In separate court cases, a jury dings Gateway for misdirecting phone calls, and a federal court bars Emachines from selling products that infringe on HP patents.

In separate court cases, a Florida jury dinged Gateway for sending phone calls to the wrong business, and a federal court in Houston issued an injunction barring Emachines from selling products that infringe on Hewlett-Packard patents.

A jury in Florida ruled last week that Gateway must pay $3.6 million for a typo in which it sent customers with a PC problem to an 800 number owned by Pensacola, Fla.-based Mo' Money Associates instead of the company's own complaint line, which had a similar number but with an 888 prefix.

Mo' Money, which sells promotional items, had been seeking $7.8 million in the suit, which was filed last year. Gateway had offered to settle for $300,000.

As for the Emachines case, lawyers for HP said that a U.S. District Court judge in Houston ruled that Emachines infringed on nine patents originally issued to Compaq Computer and ordered Emachines not to commit further infringement on two of the patents.

According to HP's lawyers, the judge's decision means Emachines must remove two infringing features from its computers, switch to components from suppliers that HP has licensed, or stop selling its computers in the United States.

Emachines said the ruling won't hurt its finances or operations because the patents in question relate to older Emachines computer models and to technology the company no longer uses in its product lines.

"The injunction will not affect any of Emachines' current or future products," CEO Wayne Inouye said in a statement. A trial on the remaining issues that are part of this lawsuit is scheduled for October, Emachines said.

HP spokeswoman Rebeca Robboy said the company is "gratified by the ruling."

Gateway said its verdict will be paid by its insurance. Mo' Money President Cliff Mowe said that the company's losses were greater than the verdict, but he does not plan to appeal for a larger amount.

"All things considered I guess we're just happy to have it behind us," Mowe said.

When Gateway inadvertently listed the Mo' Money number in 1999, Mowe said his company was getting as many as 8,000 calls a month. Mowe said the problem was exacerbated by the fact that the callers who Gateway had mistakenly sent to his company were calling because they already had a problem.

"These people were not calling happily," Mowe said. "It was very difficult to get them off the phone because the only number they had was ours and they thought they were giving them the runaround."

Now that Gateway has corrected the error, Mowe said the number of misdirected calls has slowed to a trickle.