The Patent Office Has Rejected WatchGuard’s Request to Invalidate One of the Three Patents Asserted Against It and Digital Will Now Seek an Expedited Path to Trial

Lenexa, KS, Dec. 04, 2017 (GLOBE NEWSWIRE) -- Digital Ally, Inc. (NASDAQ: DGLY) today announced that the United States Patent Office has rejected the request of Enforcement Video, LLC (d/b/a WatchGuard Video) to institute an inter partes review (“IPR”) on U.S. Patent No. 9,325,950 (“the ‘950 Patent”). The ‘950 Patent is asserted against WatchGuard in a patent infringement lawsuit pending in the U.S. District Court in   Kansas. The lawsuit also involves U.S. Patent Nos. 8,781,292 (“the ‘292 Patent”) and 9,253,452 (“the ‘452 Patent”), the same two patents asserted against Axon Enterprise, Inc. (“Axon,” formerly known as TASER International, Inc.). Digital’s lawsuit against WatchGuard claims infringement of these three patents by WatchGuard’s VISTA WiFi® body camera and its 4RE® Digital HD Panoramic In-Car System. Digital is seeking both damages and an injunction preventing the sale of these products.

WatchGuard previously had agreed to be bound by the Patent Office’s decisions on Axon’s IPRs relating to the ‘452 Patent and ‘292 Patent. The U.S. Patent Office has recently rejected three of Axon’s four petitions after it determined that Axon failed to demonstrate even a reasonable likelihood of invalidating the underlying patents in its IPR petitions, and therefore such IPR’s were dismissed. The Patent Office’s decision on the ‘950 Patent yet again confirms the strength and validity of Digital Ally’s patents, which have now survived multiple attempts by both Axon and WatchGuard to invalidate them.

WatchGuard is now barred from filing any further IPRs on any of the three patents asserted against it meaning the practical availability of WatchGuard’s litigation defenses are now severely limited. The U.S. District Court stayed the litigation while the determination of these IPRs was pending.  In light of the denials of these IPRs by the Patent Office, Digital now plans to seek to lift the stay in the WatchGuard litigation and will request an expedited schedule to trial.

“The validity of our patents has repeatedly been upheld despite an onslaught of attacks from both Axon and WatchGuard,” said Digital’s CEO, Stanton E. Ross. “This ruling is a wonderful testament to the work done by our employees at Digital and a confirmation of what we have been telling our shareholders about the litigation,” stated Ross. “In both the Axon and the WatchGuard litigation we will seek to move forward as quickly as possible. Our goal is to obtain a permanent injunction that will require the removal of these products and the infringing features from the market. If we are successful with obtaining an injunction, I would caution the customers of Axon and WatchGuard that we intend to pursue all available legal options for removing and/or de-activating unlicensed infringing features from existing products in the field,” concluded Ross.

About Digital Ally
Digital Ally®, headquartered in Lenexa, KS, specializes in the design and manufacturing of the highest quality video recording equipment and video analytic software. Digital Ally pushes the boundaries of technology in industries such as law enforcement, emergency management, commercial fleets, and consumer use. Digital Ally’s complete product solutions include in-car and body cameras, cloud and local management software, and automatic recording technology. These products work seamlessly together and are simple to install and operate. Digital Ally products are sold by domestic direct sales representatives and international distributors worldwide.

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. These forward-looking statements are based largely on the expectations or forecasts of future events, can be affected by inaccurate assumptions, and are subject to various business risks and known and unknown uncertainties, a number of which are beyond the control of management. Therefore, actual results could differ materially from the forward-looking statements contained in this press release. A wide variety of factors that may cause actual results to differ from the forward-looking statements include, but are not limited to, the following: whether the Company will achieve positive outcomes in its patent litigation against various parties, including Axon Enterprise, Inc. and WatchGuard; whether the Patent Office rulings will curtail, eliminate or otherwise have an effect on the actions of Axon, WatchGuard and other parties respecting Digital Ally, its products and customers; whether the Company will be able to obtain permanent injunctions against Axon and WatchGuard; competition from larger, more established companies with far greater economic and human resources; its ability to attract and retain customers and quality employees; the effect of changing economic conditions; and changes in government regulations, tax rates and similar matters. These cautionary statements should not be construed as exhaustive or as any admission as to the adequacy of the Digital’s disclosures. It cannot predict or determine after the fact what factors would cause actual results to differ materially from those indicated by the forward-looking statements or other statements. The reader should consider statements that include the words "believes", "expects", "anticipates", "intends", "estimates", "plans", "projects", "should", or other expressions that are predictions of or indicate future events or trends, to be uncertain and forward-looking. Digital Ally does not undertake to publicly update or revise forward-looking statements, whether as a result of new information, future events or otherwise. Additional information respecting factors that could materially affect the Digital and its operations are contained in its annual report on Form 10-K for the year ended December 31, 2016 and quarterly report on Form 10-Q for the three and nine months ended September 30, 2017, as filed with the Securities and Exchange Commission.

Contact Information
Stanton Ross, CEO
Tom Heckman, CFO
Digital Ally, Inc