Section 587. Investigation of application; grounds for denial; revocation of license

(a) Upon receipt of the application, the licensing authority of
  the  appropriate  city, town or village in which such sale is to be held
  may make or cause to be made an examination into any or  all  the  facts
  contained  in  the application and inventory in relation to the proposed
  sale. A license shall be denied or refused if any one  or  more  of  the
  following facts or circumstances is found to exist:
    (1)  That  the applicant is not the true owner of the goods, wares and
  merchandise to be sold.
    (2) That the  applicant  has  not  been  the  owner  of  the  business
  advertised or described in the application for a license hereunder for a
  period  of at least six months prior to the date of the application, or,
  if the applicant be a corporation or association,  controlling  interest
  in the corporation or association had been transferred within six months
  prior  to  the  date of the application for a license hereunder, except-
  (i) Where the application is for a license for a "sale of goods  damaged
  by  fire,  smoke,  or  water,"  or  a  "defunct  business sale," and the
  inventory listed in the application contains only those goods, wares  or
  merchandise  which were on the premises at the time of the occurrence of
  the circumstances warranting the granting of a license hereunder;
    (ii) Upon the death of a person  doing  business  in  the  state,  the
  representatives  of  his  estate,  or  his  or  her heirs, distributees,
  devisees, legatees, or their successors and assignees,  shall  have  the
  right to apply at anytime for a license hereunder;
    (iii)  Where  a  business  is required or compelled to be discontinued
  because the premises upon which it is being conducted have been taken by
  eminent domain or because the premises must be vacated pursuant to legal
  or judicial proceedings.
    (3) That in the case of a "closing out sale," the applicant, either as
  owner, partner, member of an association, or principal stockholder of  a
  corporation,  was  granted  a  prior  license  hereunder within one year
  preceding the date of the filing of the application, or  the  applicant,
  within  one  year  prior  to  the date of filing of the application, has
  conducted a sale in connection with which he advertised  or  represented
  that  the entire business conducted at the particular location for which
  the license is sought was to be closed out or terminated.
    (4) That the  inventory  contains  goods,  wares  or  merchandise  not
  purchased  by  the  applicant  for  resale  on  bona fide orders without
  cancellation privileges.
    (5) That the inventory contains goods, wares or merchandise  purchased
  by the applicant on consignment, except if the consigned goods, wares or
  merchandise   have   been   damaged  while  in  the  applicant's  actual
  possession.
    (6) That the applicant has within one year prior to the filing of  the
  application been convicted of a violation of this act.
    (7) That the goods, wares or merchandise as described in the inventory
  were  transferred  or assigned to the applicant prior to the date of the
  filing of the application and that said transfer or assignment  was  not
  made for a valuable and adequate consideration.
    (8)  That  in  the case of a "closing out sale" or a "defunct business
  sale," the inventory contains goods, wares or merchandise  purchased  by
  the  applicant  or  added to his stock in contemplation of such sale and
  for the purpose of selling the same at such sale.  Any unusual  purchase
  or  addition  shall  be  presumptive  evidence  that  such  purchase  or
  additions were made in contemplation of such sale and for the purpose of
  selling the same at such sale.
    (9) That any representation  made  in  the  application  is  knowingly
  false.

    (b)  Revocation.  The  licensing  authority  shall  revoke any license
  granted under the provisions of this article if, after investigation, it
  shall determine:
    (1)  That  any sale by the applicant has been or is being conducted in
  violation of any provision of this article, or;
    (2) That the applicant has  made  any  material  misstatement  in  his
  application for said license, or;
    (3)  That  the  applicant  has  knowingly  failed  to  include  in the
  inventory, filed with this application, all goods, wares or  merchandise
  required to be contained in such inventory, or;
    (4) That the applicant has added or permitted to be added to said sale
  or  offered or permitted to be offered at said sale, any goods, wares or
  merchandise not described in the original application and inventory, or;
    (5) That the applicant  made  or  permitted  to  be  made  any  false,
  misleading   or  deceptive  statements,  whether  written  or  oral,  in
  advertising said sale, or in displaying, ticketing,  or  pricing  goods,
  wares or merchandise offered for sale.
    (c)  Any  complaint  filed with the licensing authority concerning any
  violation of this article shall be in writing and duly verified  by  the
  complainant.
    (d)  If  the  licensing authority shall revoke any license pursuant to
  the provisions  of  subsection  (b),  it  shall  serve  notice  of  such
  revocation upon the licensee within twenty-four hours of the revocation.
  Notice  of revocation shall be served on the licensee in the same manner
  as a summons as prescribed by the civil practice law  and  rules  or  by
  registered  or  certified mail, return receipt requested. The failure of
  the licensee to discontinue said sale upon receipt of such notice  shall
  constitute a violation of this article.