Here is the Kobo support suggested solution I received (it didn't solve the problem for me):
Quote:
Hi ,
Thank you for your email. We do apologize for the inconvenience this may have caused you.
It seems that you are experiencing issues with your Kobo Touch. A basic reset may fix these issues so please follow these steps:
***Please note that a basic reset does not delete any books from your eReader.***
1. Please put your Kobo Touch into SLEEP MODE by sliding the power button to the right and holding for 1 second and then releasing the button.
2. Turn over the device and locate the small hole on the back near the bottom.
3. Unfold a paperclip and slide an end into the hole.
4. Press gently until you feel a click and release.
5.The Touch should restart.
Using a Micro SD card will expand the number of eBooks your Kobo Touch can hold. The Kobo Touch is capable of handling a Micro SD card up to 32 GBs in size. Please note that using a Micro SD card with the Kobo Touch will drain the battery faster than normal.
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The above didn't solve this problem for me. As it stands, the Kobo does not support microSD memory expansion.