Digital Ally slides after announcing patent resolution with WatchGuard
Digital Ally announced earlier that the company and WatchGuard, f/k/a Enforcement Video, d/b/a WatchGuard Video, have reached a resolution of the pending patent infringement litigation brought by Digital Ally against WatchGuard. On May 13, the parties resolved the dispute and executed a settlement agreement in the form of a patent license and settlement agreement. WatchGuard will pay Digital Ally a one-time, lump sum settlement payment of $6M dollars. Digital Ally has granted WatchGuard a perpetual covenant not to sue if WatchGuard's products incorporate agreed-upon modified recording functionality. Digital Ally has also granted WatchGuard a license to the '292 Patent and the '452 Patent through December 31, 2023. The parties have agreed to negotiate in good faith to attempt to resolve any infringement that occurs after the license period expires. The parties have further agreed to release each other from all claims or liabilities pre-existing the settlement. As part of the settlement, the parties agreed that WatchGuard is making no admission that it has infringed any of Digital Ally's patents. In afternoon trading, Digital Ally shares have fallen $1.15, or 25%, to $3.43.