§ 421 — Registration of distributors

§ 421. Registration of distributors. 1. General. The commissioner,\nupon the application of a distributor, shall register such distributor\nin suitable books to be kept by the department for that purpose,\nconditioned upon the obtaining of appropriate licenses pursuant to the\nalcoholic beverage control law, and the continuance of such license\nshall be a continuing condition of registration as a distributor under\nthis article. The application shall be in a form and contain such data\nas the commissioner shall prescribe. No distributor, unless so\nregistered, shall make any sale of alcoholic beverages within this\nstate, except a sale, if any, as to which this state is without power to\nimpose such condition. No person, unless so registered, shall (i) import\nor cause any liquors to be imported in this state for sale or use within\nthis state, (ii) purchase a warehouse receipt and pursuant to such\npurchase then cause liquors covered by such receipt to be removed from a\nwarehouse in this state or (iii) except in accordance with clause (i) or\n(ii) of paragraph (b) of subdivision four of section four hundred twenty\nof this article, produce, distill, manufacture, compound, mix or ferment\nany such liquors within this state for sale. Provided, however, that the\ncommissioner may exclude from registration requirements any person who\nis a distributor of liquors solely by reason of the importation into\nthis state of no more than ninety liters of liquors during a one-year\nperiod for such person's personal use and consumption to register as a\ndistributor with respect to liquor. Provided, further, that an\nabbreviated registration in the from of a permit, without a bond, may be\ninstituted by the commissioner for the purpose of authorizing the\nimportation of up to three hundred sixty liters of liquors per year into\nthis state by an individual for such individual's personal use and\nconsumption in this state.\n 2. Temporary restraining order and permanent injunction against\nunlawful importation and a forfeiture of unlawfully imported or produced\nliquors. (a) In an action commenced pursuant to this subdivision\nwhenever evidence is furnished by the commissioner showing a substantial\nlikelihood that a person not registered as a distributor as required by\nthis article has imported or may import liquors into this state or\ncaused or may cause liquors to be imported into this state for sale or\nuse in this state or has produced, distilled, manufactured, compounded,\nmixed or fermented or may produce, distill, manufacture, compound, mix\nor ferment liquors within the state or, pursuant to a purchase of a\nwarehouse receipt, has caused or may cause liquors covered by such\nreceipt to be removed from a warehouse in this state, the court, taking\ninto consideration the fungible nature of such liquors, may make a\ntemporary order without notice prohibiting such person and his agents\nfrom selling, transferring or otherwise disposing of any liquors or any\nliquors and also prohibiting all other persons in possession of or\nhaving control over the same from selling, releasing, transferring or\notherwise disposing of any liquors imported or caused to be imported,\nproduced, distilled, manufactured, compounded, mixed or fermented, sold\nor transferred or removed by such person not so registered pending a\nhearing for a preliminary injunction.\n (b) Upon granting a temporary order, the court shall direct that a\nhearing be held at the earliest possible time upon such notice and\nservice as the court shall direct. Where, after such opportunity for a\nhearing, the court determines that there is a likelihood that the\ncommissioner will prevail in such action, the court may grant a\npreliminary injunction restraining the sale, release, transfer or other\ndisposition of liquors subject to the temporary order.\n (c) (1) Whenever the commissioner shall discover that any person not\nregistered as a distributor as required by this article has imported\nliquors into this state or caused liquors to be imported into this state\nfor sale or use in this state or has produced, distilled, manufactured,\ncompounded, mixed or fermented liquors within the state or, pursuant to\na purchase of a warehouse receipt, has caused liquors covered by such\nreceipt to be removed from a warehouse in this state, the commissioner\nmay commence an action in supreme court for a permanent injunction and\nforfeiture of liquors. If it is established by a preponderance of the\nevidence that liquors were imported or caused to be imported into this\nstate for sale or use in this state, were produced, distilled,\nmanufactured, compounded, mixed or fermented, or were caused to be\nremoved from a warehouse in this state by the purchaser of a warehouse\nreceipt with respect to such liquors, by any person not registered as a\ndistributor, as required by this article, the court shall grant a\njudgment (i) permanently enjoining such person and his agents from\nselling, transferring or otherwise disposing of any such liquors or any\nliquors within this state and (ii) declaring the forfeiture of any\nliquors that were so imported, caused to be imported, produced,\ndistilled, manufactured, compounded, mixed, fermented or removed by such\nperson.\n (2) With respect to liquors that were imported, caused to be imported,\nproduced, distilled, manufactured, compounded, mixed, fermented or\nremoved by a person not registered as a distributor as required by this\narticle or that were unlawfully sold or transferred by such person, if\nit is established by a preponderance of the evidence that any other\nperson in possession of or having control over such liquors was not a\npurchaser or transferee in good faith of such liquors with respect to\nthe fact that such liquors were so imported, caused to be imported,\nproduced, distilled, manufactured, compounded, mixed, fermented or\nremoved by a person not registered as a distributor as required by this\narticle or that such liquors were so unlawfully sold or transferred by\nsuch person, the court shall grant a judgment (i) permanently enjoining\nsuch other person and such person's agents from selling, releasing,\ntransferring or otherwise disposing of any such liquors and (ii)\ndeclaring the forfeiture of such liquors in the possession or under the\ncontrol of such other person.\n (d) The commissioner may, at any time subsequent to the granting of\nthe temporary order pursuant to paragraph (a) of this subdivision, with\nthe approval of the court, consent to a sale of liquors subject to such\ntemporary order which is in the possession or under the control of a\nperson other than the person or the agent of the person who imported,\ncaused to be imported, produced, distilled, manufactured, compounded,\nmixed, fermented, removed or unlawfully sold or transferred such\nliquors. As a condition of granting permission to a sale of liquors\npursuant to this subdivision, the commissioner shall require the payment\nof all taxes, penalties and interest imposed by and pursuant to the\nauthority of this chapter with respect to such liquors.\n (e) (1) At any time during the pendency of an action under this\nsection, the liquors subject to a temporary, preliminary or permanent\norder hereunder may be released from the scope of such order if there is\ngiven an undertaking, in an amount equal to the market value of such\nliquors plus any excise, state and local sales and use and federal\nexcise taxes, to the effect that there will be paid to the commissioner\nthe amount of the market value of such liquors and such taxes in the\nevent that such liquors are adjudged forfeited.\n (2) Any person enjoined by a temporary order or a preliminary\ninjunction issued pursuant to this subdivision or other person\ninterested in any such liquors may move at any time, on notice to all\nparties, to vacate or modify it.\n (f) The procedures of the civil practice law and rules applicable to\ntemporary restraining orders, preliminary injunctions and permanent\ninjunctions not inconsistent with this subdivision shall apply to\ntemporary orders, preliminary injunctions and permanent injunctions\nissued under this subdivision. The procedural provisions set forth in\nparagraph three of subdivision (d) and in subdivision (j) of section\neighteen hundred forty-five of this chapter shall apply to the\nforfeiture proceedings under this subdivision and, in respect to a\ndeclaration of forfeiture under this subdivision, the court may direct\nthe commissioner to sell or otherwise dispose of such forfeited liquors\non such conditions the commissioner deems most advantageous and just\nunder the circumstances. The commissioner shall not be required to file\nany undertaking in connection with an action pursuant to this\nsubdivision.\n