Following Hatfield's retirement from the Senate in 1996, Lonsdale ran again in the 1996 primary, but lost to Mentor Graphics founder Tom Bruggere by a wide margin.
Bruggere's Republican opponent, Gordon Smith, was also heavily self-financed, having spent $2.5 million of his own money earlier that same year in an unsuccessful effort to defeat Democrat Ron Wyden in the special election to replace Bob Packwood, who had resigned.
Oregon State Senate President Gordon Smith, who had run for the Senate earlier that year, won the Republican primary, while businessman Tom Bruggere won a contested Democratic primary.
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