FOR IMMEDIATE RELEASE

25.SEPT.2008

http://www.edigital.com/news/25SEPT2...

e.DIGITAL ANNOUNCES FIRST FLASH-R™ PATENT PORTFOLIO LICENSE AND SETTLEMENT AGREEMENT

Company Also Cross-Licenses Multimedia-Related Patents

(SAN DIEGO, CA, – September 25, 2008) – e.Digital Corporation (OTC: EDIG), a leading technology innovator of dedicated portable entertainment systems and patented flash memory-related technology announced today that a major electronics manufacturer has purchased the first license for its Flash-R™ patent portfolio. Under the terms of the confidential licensing and settlement agreement, e.Digital is receiving a one-time licensing fee and cross-license rights to certain patents covering multimedia-related products.

e.Digital’s Flash-R patent portfolio covers certain aspects of the use of flash memory, addressing today's large and growing portable electronics products market. The Company unveiled the first portable recorder with removable flash memory in 1993 and believes its patent portfolio to be essential to many consumer electronics products that utilize flash memory including cell phones, digital cameras, camcorders, PDA’s and other popular devices. In September 2007 and March 2008, the Company filed its first Flash-R portfolio patent infringement litigation against eight defendants.

"We are very pleased to have entered into what we believe will be the first of many Flash-R patent portfolio licensing agreements,” said Robert Putnam, senior vice president of e.Digital Corporation.