§ 71-804. Denial or revocation of exemption - Orders and violation thereof.

A.  The Administrator may issue a final order denying or revoking any exemption specified in Section 803 of this title, not including the exemption provided for in paragraphs 2 and 7 of Section 803 of the Oklahoma Business Opportunity Sales Act, with respect to a particular offering of one or more business opportunities if the Administrator finds that the order is in the public interest and that:

1.  Any provision of the Oklahoma Business Opportunity Sales Act or any rule, order or condition lawfully imposed pursuant to the act has been willfully violated, in connection with the offer or sale of the business opportunity by the seller, any partner, officer or director of the seller, any persons occupying a similar status or performing similar functions, or any person directly or indirectly controlling or controlled by the seller;

2.  The business opportunity is the subject of an administrative order denying, suspending, or revoking a registration or a permanent or temporary injunction of any court of competent jurisdiction; but the Administrator:

a.may not institute a proceeding pursuant to this paragraph more than one (1) year from the date of the order or injunction relied on, and

b.may not enter an order pursuant to this paragraph on the basis of an order or injunction entered under any other state act unless that order or injunction was based on facts, other than facts which establish jurisdiction, which would currently constitute a ground for an order under this section;

3.  The seller's enterprise or method of business, or that of the business opportunity, includes or would include activities which are illegal where performed;

4.  The business opportunity or the offering of a business opportunity has worked or tended to work a fraud upon purchasers or would so operate; or

5.  The seller's literature or advertising is misleading, incorrect, incomplete or deceptive.

Except as provided in subsection B of this section or unless the right to notice and hearing is waived by the person against whom the final order is to be issued, no order may be issued under this section without notice and opportunity for hearing as required by the Administrative Procedures Act.  If the person to whom such notice is addressed does not request a hearing within fifteen (15) days after the service of such notice is effective, a final order shall be issued.

B.  If the Administrator makes written findings of fact to support the conclusion that the public interest will be harmed by delay in issuing an order pursuant to subsection A of this section, the Administrator may by order summarily deny or revoke any of the specified exemptions, not including the exemption provided for in paragraphs 2 and 7 of Section 803 of this title, pending final determination of any proceeding under this section.  Upon the entry of the summary order, the Administrator shall promptly notify the respondent or respondents:

1.  That the summary order has been entered and the reasons therefor;

2.  That the person subject to the summary order, if desiring a hearing, must make written request for a hearing to the Administrator within fifteen (15) days after service of the notice is effective;

3.  That within fifteen (15) days after receipt by the Administrator of a written request the matter will be set for hearing to determine whether the summary order should be modified, vacated, or extended pending final determination of any proceeding under subsection A of this section; and

4.  That a hearing shall be commenced within fifteen (15) days of the matter being set for hearing.  The summary order shall remain in effect until the conclusion of the hearing on the summary order unless the Administrator or the Administrator’s designee extends the summary order pending a final determination of any proceeding under subsection A of this section.  If no hearing is requested and none is ordered by the Administrator, the summary order will remain in effect until it is modified or vacated by the Administrator or the Administrator’s designee.  If a request for hearing on the summary order is timely made and if the hearing is not commenced by the Administrator within the time limit set forth herein, the summary order shall dissolve and an order shall not be issued pursuant to subsection A of this section except upon reasonable notice and opportunity for a hearing.

C.  No order under this section may operate retroactively.

D.  No person may be considered to have violated Section 806 of this title by reason of any offer or sale effected after the entry of an order under Section 804 of this title if he or she sustains the burden of proof that he or she did not know, and in the exercise of reasonable care could not have known, of the order.

Added by Laws 1985, c. 157, § 4, eff. Nov. 1, 1985.  Amended by Laws 1997, c. 279, § 24, eff. July 1, 1997; Laws 1999, c. 109, § 12, eff. July 1, 1999.