Microsoft, under increasing pressure to cut costs, says a competive bidding process led it to drop law firm K&L Gates from its top 10 list of "preferred" legal providers. The news is notable because the firm traces its roots, in part, to Preston Gates & Ellis -- with the "Gates" in its name referring to Microsoft Chairman Bill Gates' father. But Microsoft says it will still continue to work with the firm.

“We have had a Preferred Provider program in place for several years to consolidate a portion of our legal work and manage our legal costs efficiently. We recently decided to refresh the program," said Microsoft spokesman David Bowermaster in a statement.

The statement added, "We solicited competitive bids from a number of firms and conducted an extensive  review. That led to a selection of 10 firms across the country. While K&L Gates is not among these ten, it will remain a valued and longstanding partner and a significant contributor to our success.”

The Seattle Times first reported the news earlier today.

American Lawyer Media's AmLaw Daily notes that K&L Gates wasn't the only firm dropped from the list. At the same time, it's a sign of looser ties between the company and the firm. Former Microsoft general counsel Bill Neukom left the law firm last year to become the San Francisco Giants' managing general partner.