It's a 3-position switch. I have the same light, it has the LEDs and a 5mW red laser.
Click-LEDs on, red laser off.
Click-Red laser on, LEDS off.
Click-All off.
I put an 803T in the light, and it's not too annoying to have the 3-position, 2 offs and 1 on. I just go in the habit of when I click the laser off, I click it again so that it would be ready to come on next time I want it.
this flashlight looks strikingly similiar to the one i am using to make a laser, in the one i bought, the switch was a multi-switch (if thats even a real name), it was an LED/laser pointer flashlight, normally you click once, LED lights, click again, lser pointer, click again, off.
so that may be your problem, i fixed mine by taking the switch from an old cd-rom drive (the open button), plus i wanted one that only came on when i held the button (and to make more room inside the flashlight)