(a) An original or renewal application may be denied for any of the following reasons:
  (1) failure of the application to comply with §72.3 of this title (relating to Application and License), including failure to include the required application or licensing fee; or
  (2) where the secretary of state determines that the intended use is detrimental to the image of the state or otherwise not in the state's best interests.
(b) Suspension or revocation of license. A license may be suspended or revoked if the secretary of state determines that the licensee is using or has used the state seal in a manner detrimental to the image of the state or otherwise not in the state's best interests.
(c) Uses that are detrimental to the image of the state or otherwise not in the state's best interests may include the following:
  (1) abuse of the state seal;
  (2) criminal use of the state seal;
  (3) failure to observe reporting requirements, including payment of royalty fees;
  (4) failure or refusal to allow monitoring under §72.9 of this title (related to Monitoring) or §17.08(f), Texas Business & Commerce Code;
  (5) use in violation of §17.08, Texas Business & Commerce Code or these sections;
  (6) continuing violation after notice thereof; and
  (7) such other uses as determined by the secretary of state.
(d) The denial of an application or renewal, or the suspension or revocation of a license, is subject to the right of notice, hearing, and adjudication as set out in the rules of practice and procedure before the Office of the Secretary of State, the rules of the State Office of Administrative Hearings, and the Administrative Procedure Act, Government Code, §§2001.001 - 2001.902. Any party to a contested case has the right to be represented by legal counsel. Such action will be subject to the right of appeal to a district court of Travis County.

Source Note: The provisions of this §72.5 adopted to be effective December 10, 2012, 37 TexReg 9617