
    Theresa Ferraro et al., Individually and Formerly Doing Business as Michael's House of Steaks, Respondents-Appellants, v United States Fidelity and Guaranty Company, Appellant-Respondent.
   Order unanimously affirmed, with costs to plaintiffs. Memorandum: Special Term did not abuse its discretion in refusing to grant an unconditional order of preclusion. Thus, plaintiffs motion for summary judgment was properly denied.

The cross motion for a protective order was properly denied since defendant failed to meet its burden of proving that the information sought by plaintiffs is privileged (see, Fonda v Nationwide Mut. Fire Ins. Co., 99 AD2d 680; Hawley v Travelers Indem. Co., 90 AD2d 684). Defendant’s affidavit opposing discovery contains conclusory and hearsay statements and fails to state facts showing that it had made a decision to reject the claim either before it hired an attorney to investigate the fire or at any time before it notified plaintiffs of the rejection. (Appeals from order of Supreme Court, Erie County, Mintz, J.—preclusion.) Present—Callahan, J. P., Doerr, Boomer, Pine and Schnepp, JJ.  