The "Fatal Attraction" star was discussing the importance of awards shows with ABC News' "Popcorn with Peter Travers", when she recalled the night Paltrow picked up a surprise win.
"I honestly feel that to be nominated by your peers is about as good as it gets," she said. "I've never understood how you could honestly compare performances, you know? I remember the year Gwyneth Paltrow won over that incredible actress who was in 'Central Station' (Fernanda Montenegro) and I thought, 'What?' It doesn't make sense."
"I think who wins has a lot of things to do with how things have been, you know, whether it has traction or whatever (sic). Publicity, how much money did they have to put it out in front of everybody's sight. I have to be philosophical about it... I'm very proud of the times that my peers have felt that my performance was worthy of attention."
in 1999, Paltrow beat out Montenegro, who is often cited as the Brazilian equivalent of Meryl Streep, in addition to Cate Blanchett for "Elizabeth", Meryl Streep for "One True Thing" and Emily Watson for "Hilary and Jackie".
At the time, Montenegro herself didn't hide her upset at the loss as she claimed that Paltrow's thin, virginal character likely won because "they don't have much of this type of actress in America."
Close has been nominated for an Oscar seven times, but never won.