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Leading Brands, Inc. Announces Settlement of Litigation

VANCOUVER, CANADA - July 26, 2004 - LEADING BRANDS, INC. (NASDAQ: LBIX), North America’s only fully integrated premium beverage company, announces that all litigation and disputes among the company, its affiliates and management (together, the “Company”) and Thomas C. Lines, Futuristic Brands USA, Inc., New Sun Beverages Company (USA) Inc. and other companies controlled by or associated with Mr. Lines (together the “Lines Group”) have been settled. No payment was made by the Company to or on behalf of any member of the Lines Group. As part of the settlement, a substantial payment was made by Robert W. Miller, the former President of Leading Brands of America, Inc. (“LBAI”) to LBAI and LBAI’s lawsuit against Mr. Miller and related litigation was also settled. In addition, the license agreements for Mad Croc, Red Devil and New Sun beverages were terminated and certain suppliers of those products to LBAI forgave substantial claims that will result in the Company recording a six figure gain in the present quarter.

The Company withdraws and retracts any statements previously made by it in respect of any member of the Lines Group. In particular, the Company withdraws and retracts the allegations made in its news releases of February 19, 2004, and April 12, 2004.

About Leading Brands, Inc.
Leading Brands, Inc. (NASDAQ:LBIX) is North America’s only fully integrated premium beverage company. The Company’s unique Integrated Distribution System (IDS) ™ offers turnkey, one-stop shopping to food and beverage brand owners, including manufacturing, distribution, sales/marketing and licensing. In addition, Leading Brands produces their own line of beverages such as TrueBlue®, LiteBlue®, TREK® Natural Sports Drinks, NITRO® Energy Drinks, INFINITY® Health Water™, Country Harvest® Juices, and Caesar’s® Cocktails.

Forward Looking Statements
Certain information contained in this press release includes forward-looking statements. Words such as “believe”, “expect,” “will,” or comparable terms, are intended to identify forward-looking statements concerning the Company’s expectations, beliefs, intentions, plans, objectives, future events or performance and other developments. All forward-looking statements included in this press release are based on information available to the Company on the date hereof. Such statements speak only as of the date hereof. Important factors that could cause actual results to differ materially from the Company’s estimations and projections are disclosed in the Company’s securities filings and include, but are not limited to, the following: general economic conditions, weather conditions, changing beverage consumption trends, pricing, availability of raw materials, economic uncertainties (including currency exchange rates), government regulation, managing and maintaining growth, the effect of adverse publicity, litigation, competition and other risk factors described from time to time in securities reports filed by Leading Brands, Inc.

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