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Judge Dismisses Verdicts Against Former Gateway Execs

A federal judge May 30 overturned a jury’s verdicts in a fraud case against two former executives of computer maker Gateway Inc.

Federal Judge Roger Benetiz overturned civil findings of fraud and lying to auditors for John Todd, Gateway’s former chief financial officer, and Robert Manza, former controller, handed down by a San Diego jury in March but then appealed.

The Securities and Exchange Commission made the allegations in a lawsuit filed against Todd and Manza in 2003. Gateway was based in San Diego County at the time. The company moved to Orange County in 2004.

Also in his ruling May 30, Benetiz upheld the jury’s verdicts for both men in aiding and abetting false filings on Gateway’s financial reports.

The court imposed a fine of $10,500 on Manza. He was facing total fines and interest of more than $125,000, according to James Sanders, the attorney for Manza.

Todd paid a fine of about $16,000, Sanders said.

The court also denied an SEC request to bar Manza from serving as an officer or director of a public corporation, said Sanders, an attorney with the Los Angeles office of McDermott Will & Emery.

The SEC settled with Gateway regarding fraud allegations against the company in 2003 without the company admitting or denying any liability.

Gateway, among San Diego’s largest companies in the 1990s, downsized earlier this decade, merged with eMachines in 2004 and moved its corporate offices to Irvine from Poway.

, Mike Allen

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