Digital Ally Refutes Inaccurate Reports Regarding Its '292 Patent

LENEXA, KS -- (Marketwired) -- 09/10/15 -- Digital Ally, Inc. (NASDAQ: DGLY) ("the Company") today addressed the many inaccurate reports stemming from a press release issued by TASER on September 2, 2015, and regarding Digital Ally's U.S. Patent No. 8,781,292 (the '292 Patent). In the September 2nd press release, TASER stated that the "Digital Ally patent claims were found unpatentable by the USPTO due to prior art found by TASER." This statement is misleading and inaccurate. This inaccuracy, along with the general complexity of patent law, has led many in this technology sector, including the media, to incorrectly report on Digital Ally's '292 Patent and the TASER press release. To set the record straight, Digital Ally is providing the following information:

• Digital Ally owns the '292 Patent, which is directed to a system that determines when a recording device, such as a law enforcement officer's body camera or in-car video recorder, begins recording and automatically instructs other recording devices to begin recording. The technology described in the '292 Patent is incorporated in Digital Ally's VuLink product.
• In April 2015, TASER filed a request for reexamination of the '292 Patent with the U.S. Patent Office. A reexamination is essentially a request that the Patent Office review whether the patent should have issued in its present form in view of the "prior art," e.g., other patents in the same technology field. The prior art used by TASER to request the reexamination is a patent application (which never issued into a patent) assigned to Motorola, Inc.
• TASER's September 2nd press release is incorrect in stating that the U.S. Patent Office has found the claims unpatentable. The reexamination is just beginning, and the recent action by the U.S. Patent Office is nothing more than a preliminary, non-final statement on the '292 Patent. Digital Ally has the opportunity to respond to the U.S. Patent Office's recent action, explain how its '292 Patent is an industry-leading invention, describe the flaws with TASER's arguments, and freely amend its patent if necessary to avoid any further objections. Importantly, the Patent Office has not made a final determination that any of the claims are unpatentable, and the reexamination process is far from complete. TASER appears to be using a press release with misleading and inaccurate statements to bolster its position without a final decision by the Patent Office.
• TASER has advertised for the past few months its Axon Signal product, which TASER says is "coming soon" on its website. Based on information TASER has released to date, the Axon Signal appears to have many of the same features as described in the '292 Patent. Given the similarities between TASER's Axon Signal product and Digital Ally's '292 Patent, Digital Ally presumes TASER filed the reexamination because TASER is concerned its Axon Signal product infringes the '292 Patent. In other words, it appears that TASER is attempting to remove a threat in the marketplace -- namely, Digital Ally's '292 Patent -- that could potentially prevent TASER from selling its Axon Signal product.
• TASER has made no assertion whatsoever that Digital Ally is infringing one of TASER's patents. Instead, the reexamination appears to be in response to TASER being concerned it is or will be infringing one of Digital Ally's patents.
• Digital Ally has located some articles that say the reexamination is based on TASER prior art and that TASER invented the technology first. For clarity, TASER has not made any assertion in the reexamination that it invented the technology in the '292 Patent first, TASER has not cited in the reexamination any of its own patents as prior art, and Digital Ally's VuLink product was on the market well before TASER ever announced its Axon Signal product.

There are a number of inaccurate statements circulating in the media regarding TASER's press release and the '292 Patent. Digital Ally hopes that this press release will set the record straight regarding the status of the '292 Patent and the U.S. Patent Office's recent action.

About Digital Ally, Inc.

Digital Ally, Inc. develops, manufactures and markets advanced technology products for law enforcement, homeland security and commercial applications. The Company's primary focus is digital video imaging and storage. For additional information, visit www.digitalallyinc.com.

The Company is headquartered in Lenexa, Kansas, and its shares are traded on The Nasdaq Capital Market under the symbol "DGLY".

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 and to what extent aspects of its disclosed technology in the '292 patent will ultimately be found patentable by the USPTO and if so the extent to which the '292 patent will give the Company effective, enforceable protection of the intellectual property contained in its products in the marketplace; whether TASER'S Axon Signal product will have many of the same features as described in the '292 Patent; competition from larger, more established companies with far greater economic and human resources; 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 Company's disclosures. The Company 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. The Company 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 Company and its operations are contained in its annual report on Form 10-K for the year ended December 31, 2014 and quarterly report on Form 10-Q for the three and six months ended June 30, 2015, as filed with the Securities and Exchange Commission.

Contact:

For Additional Information, Please Contact

Stanton E. Ross
CEO
(913) 814-7774
or
RJ Falkner & Company, Inc.
Investor Relations Counsel
(800) 377-9893

Source: Digital Ally, Inc.

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