The ability to distinguish physics signals that share common signatures involving multijet final states is crucial to the success of the future Linear Collider Detector (LCD). This translates into a requirement of attaining unprecedented precision in jet energy measurements. For example, to effectively separate W and Z bosons in their hadronic final states by reconstructing their invariant masses, one will require a jet energy resolution of dE/E<30%/sqrt(E), (E in GeV) which is about a factor of 2 better than the current best. The so-called "Energy-flow algorithms" (EFA) are widely believed to be the most promising to meet such an ambitious goal. EFAs have thus become an integral part of the general approach toward LCD design. The basic premise of EFAs is based on separating in a jet, energy deposited by charged particles from those by neutrals, and substituting the former by more precise momentum measurements from the magnetized central tracker. A calorimeter optimized for EFAs must therefore have fine lateral and longitudinal segmentation necessary for tracking individual charged particles. As a possible solution, NICADD (Northern Illinois Center for Accelerator and Detector Development) proposes a digital hadronic calorimeter using scintillators as the active medium. A digital (i.e., one- or two-bit readout) approach trades dynamic range to achieve finer spatial resolution. Responses of individual scintillating cells, an array of cells, and a 12-layer (12.7cm x 12.7cm) prototype module, to radioactive source and cosmic rays have been measured. Systematic studies of cell response under different combinations of manufacturing techniques, wavelength-shifting fiber types, reflective coating agents, splicing techniques, and photo-detectors are discussed together with simulation tools and algorithms that are being developed concurrently.
