This is a known issue when updating to LabQuest version 1.5. This issue has been fixed in versions 1.5.1 and newer. Download the most recent version for free at http://www.vernier.com/downloads/
If you've already started the update with an SD card, it will update some parts of the LabQuest, then get stuck in a reboot cycle. The solution is to use a USB drive, copy the SD card over to the USB drive with the same files/folder locations as were on the SD card. The LabQuest will recover automatically on the next reboot.