§ 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.