ITEM 8.01. OTHER EVENTS.

On January 8, 2009, Franklin Electronic Publishers, Incorporated (the "Registrant") resolved litigation, pending on appeal before the United States Court of Appeals for the Third Circuit, against Nuance Communications, Inc. ("Nuance") and Caere Corporation ("Caere") pursuant to a License and Settlement Agreement (the "Agreement") with Nuance and Caere. Under the terms of the Agreement, Nuance and Caere have taken a prospective ten-year royalty bearing license for certain linguistic software that is licensed by the Registrant's Proximity Technology Division and the Registrant has released Nuance and Caere from its pending claims. As a result of entering into the Agreement, the Registrant expects an initial benefit (net of related expenses) to net income of approximately $600,000 in the year ending March 31, 2009.

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