The owner of the store is correct to say that he can refuse service to anyone. It is a privately owned store and he is within his rights. However, there are common courtesis that should be followed and a right and wrong way to do things and it sounds like, even by his own admission, that he did it the wrong way. I would say just stop shopping there to anyone that believes he was wrong in the way he appraoched this. I am sure in these economic times, he can't afford to lose any customers.