* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion

should not be published and is not precedent except under the limited

circumstances set forth in 5TH CIR. R. 47.5.4.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 08-30075

Summary Calendar

LIBERTY MUTUAL INSURANCE COMPANY

Plaintiff-Appellee

v.

DR. CLARK GUNDERSON AND 

LAKE CHARLES MEMORIAL HOSPITAL

Defendants-Appellants

Appeal from the United States District Court

for the Western District of Louisiana

USDC No. 2:04-CV-2405

Before STEWART, OWEN, and SOUTHWICK, Circuit Judges.

PER CURIAM:*

Defendants-Appellants Dr. Clark Gunderson and Lake Charles Memorial

Hospital (jointly “Gunderson”) appeal the district court’s grant of First Health

Group Corporation’s (“First Health”) motion for a permanentinjunction and stay

of proceedings. Appellee First Health requests that this Court dismiss the

instant appeal for lack of jurisdiction. We DENY First Health’s motion to

dismiss, and AFFIRM the district court’s grant of the permanent injunction. 

United States Court of Appeals

Fifth Circuit

F I L E D

November 25, 2008

Charles R. Fulbruge III

Clerk
No. 08-30075

2

I. FACTUAL AND PROCEDURAL BACKGROUND

The parties in this case have a long and complicated history of litigation.

The factual and procedural background relevant to the instant appeal is

provided below. 

Liberty Mutual entered into an agreement (“PPO Contract”)

with [First Health] whereby First Health agreed to make available

to Liberty Mutual various hospitals and medical providers.

Defendants, Dr. Clark Gunderson (“Gunderson”) and Lake Charles

Memorial Hospital (“LCMH”) entered into “Provider Agreements”

with First Health for the delivery of medical services at discounted

rates to “Payors,” namely in this suit, Liberty Mutual. . . .

Gunderson and LCMH asserted in [a prior] suit that the payment

provision of their Provider Agreements is null and void under the

disclosure rules of Louisiana’s Any Willing Provider Act, Louisiana

Revised Statute 40:2203.1, because [Liberty Mutual] (the preferred

provider organizations and third party administrators) failed to

comply with the statute’s notice provisions. Thus, Gunderson and

LCMH, assert that they are entitled to additional monies [from

Liberty Mutual] for medical services performed, in addition to

statutory penalties and attorneys’ fees. 

Liberty Mutual filed this suit requesting that the Court enter

a judgment declaring that (1) the Provider Agreements are valid

and enforceable, (2) Liberty Mutual is obligated to pay Gunderson

andLCMH only the negotiated rates for medical services performed,

(3) Gunderson and LCMH are not entitled to be paid amounts in

excess of the negotiated rates, (3) [sic] Gunderson and LCMH have

no cause of action under any law, statute, or regulation against

Liberty Mutual, and (5) Gunderson and LCMH’s efforts to receive

additional monies violate their contracts which constitutes a breach

of those contracts, entitling Liberty Mutual to damages and

indemnity, including, but not limited to attorneys [sic] fees. 

In its Second Amended Complaint, Liberty Mutual added as

a defendant, [sic] First Health. . . . Liberty Mutual maintains that

pursuant to the PPO Contract, First Health agreed to “fully

indemnify and hold harmless [Liberty Mutual] . . . from and against

any and all claims . . . .

First Health filed a motion for summary judgment

maintaining that because the Provider Agreements are valid and

enforceable, First Health is not obligated to indemnify Liberty

Mutual. . . . Liberty Mutual filed a motion for partial summary

judgment seeking a declaration against Gunderson and LCMH that
No. 08-30075

1 District courts have the power to issue a narrowly tailored injunction

under the All Writs Act to enjoin “repeatedly vexatious litigants from filing

future state court actions.” Newby v. Enron Corp., 542 F.3d 463, 2008 U.S. App.

LEXIS 19167, *5 (5th Cir. 2008). 

3

the Provider Agreements with First Health are valid and

enforceable. 

Liberty Mutual Ins. Co. v. Gunderson, No. 04-cv-2405 (W.D. La Feb. 15, 2006)

(Mem. Ruling). On February 15, 2006, the district court made the following

rulings at the summary judgment stage: 

(1) the discount provisions in the Provider Agreements between

First Health and Gunderson and LCMH are valid and enforceable

because there are no prohibitions in the Louisiana Workers’

Compensation law that prevent a provider from agreeing to charge

and received discounted rates for the services they provide to

occupationally ill or injured workers, and (2)the payment provisions

of the provider Agreement between Liberty Mutual and Gunderson

and LCMH are not null and void because Louisiana Revised Statue

§ 40.2203.1 expressly states that the notice requirement provisions

shall not apply to group purchasers (First Health) or to agreements

of a group purchaser (payors such as Liberty Mutual who have an

agreement with First Health). 

Liberty Mutual Ins. Co., No. 04-cv-2405, slip op. at 2 (W.D. La. Nov. 30, 2007)

(Memorandum Ruling). 

On October 30, 2006, the district court issued a temporary restraining

order and preliminary injunction against Gunderson preventing him from

pursuing any claim before any court arising under Louisiana’s Any Willing

Provider Act against First Health or any payor as set forth in the provider

agreements between First Health and Gunderson. Gunderson did not file an

appeal to the district court’s order granting the preliminary injunction. 

On August 24, 2007, Liberty Mutual filed a motion for civil contempt and

sanctions, for a permanent injunction, and for stay of proceedings pursuant to

the All Writs Act, 28 U.S.C. § 1651(a).1 Liberty Mutual alleged that Gunderson
No. 08-30075

2 The Anti-Injunction Act, 28 U.S.C. § 2283, generally prohibits federal

courts from interfering with state court proceedings. Under the statute, a

United States court may not grant an injunction to stay proceedings in a state

court unless it is (1) expressly authorized by Congress; (2) where necessary in

aid of its jurisdiction; or (3) to protect or effectuate its judgments. The later of

these three exceptions is commonly referred to as the “relitigation exception” to

the Anti-Injunction Act. See Duffy & McGovern Accommodation Servs. v. QCI

Marine Offshore, Inc., 448 F.3d 825, 828 (5th Cir. 2006) (stating that “a federal

court can enjoin state proceedings threatening to ignore an earlier, preclusive

federal court order”). 

4

continued to file and prosecute claims in violation of the October 2006

preliminary injunction. 

On September 27, 2007, First Health requested an order holding

Gunderson in civil contempt for violating the October 2006 preliminary

injunction. First Health also requested that the district court permanently

enjoin Gunderson from relitigating in the Louisiana state workers’ compensation

system factual and legal issues actually decided by the district court’s February

2006 memorandum ruling and April 2006 amended judgment.2

On November 30, 2007,the district court granted First Health’s motion for

a permanent injunction and stay of proceedings. The district court agreed that

Gunderson violated the district court’s October 2006 preliminary injunction

when it continued to file and prosecute claims against First Health’s payors in

the Louisiana Office of Workers’ Compensation (“OWC”). On January 2008, the

district court granted a motion to amend the November 2007 judgment, to

correct the time period regarding Gunderson’s contract with First Health. 

On January 10, 2008, Gunderson filed a notice of appeal from the

November 2007 judgment, permanent injunction, and stay order, as well as the

January 2008 amended judgment, permanent injunction, and stay order. On

appeal, Gunderson argues that the district court erred when it applied the

relitigation exception to the Anti-Injunction Act, 28 U.S.C. § 2283, to this case.
No. 08-30075

3 Gunderson notes that before the deadline to appeal the November 2007

injunction passed, First Health timely filed an unopposed motion to amend the

injunction to correct an inaccurate date. The district court then issued the

January 2008 amended judgment, and in accordance to Federal Rule of

Appellate Procedure 4(a)(1), Gunderson and LCMH timely filed a notice of

appeal of that order. 

5

On May 16, 2008, First Health filed a motion to dismiss the appeal for lack

of jurisdiction. 

II. APPELLATE JURISDICTION 

First Health contends that Gunderson claims to appeal from the district

court’s November 2007 and January 2008 judgments granting the permanent

injunction, butin actuality Gunderson is impermissibly attempting to appeal for

the first time the October 2006 and April 2006 judgments granting the

preliminary injunction. First Health refers to the preliminary injunction as the

“original injunction.” First Health claims the permanent injunction served

merely to clarify the preliminary injunction and is notindependently appealable;

therefore, this Court has no jurisdiction to hear the appeal because Gunderson

failed to appeal from the preliminary injunction. 

First Health acknowledges that 28 U.S.C. § 1292(a)(1) grants this Court

jurisdiction to entertain appeals from “[i]interlocutory orders of the district

courts . . . granting, continuing, modifying, refusing or dissolving injunctions, or

refusing to dissolve or modify injunctions.”3 But First Health argues that the

permanent injunction served merely to clarify the scope of the earlier

preliminary injunction, and “interlocutory appeals are not allowed when a court

merely enforces or interprets a previous injunction.” Ingram Towing Co. v.

Adnac Inc., 59 F.3d 513, 516 (5th Cir. 1995). Gunderson argues that it is well

settled that once an order of permanent injunction is granted, the order of

preliminary injunction is merged with it and an appeal is proper only from the

order granting the permanent injunction. Louisiana World Exposition, Inc. v.
No. 08-30075

6

Logue, 746 F.2d 1033, 1038 (5th Cir. 1984); SEC v. First Fin. Group, 645 F.2d

429, 433 (5th Cir. 1981) (internal citations omitted). 

The district court did not merely enforce or interpret the preliminary

injunction. Instead, the district court broadened the scope of the injunction and

converted the preliminary injunction into a permanent injunction. In this

situation, under First Financial Group andLouisiana World Exposition, Inc., an

appeal is proper only from the order granting the permanent injunction. First

Health’s argument that Gunderson waived the opportunity to appeal the validity

of issues related to the original preliminary injunction fails, because the

permanent injunction merged the two injunctions into one. 

The motion to dismiss for lack of jurisdiction is, therefore, DENIED. We

now turn to Gunderson’s appeal from the district court order. 

III. ANALYSIS

A. Standard of Review

The district court’s decision to issue a permanent injunction is reviewed

for abuse of discretion. Regions Bank v. Rivet, 224 F.3d 483, 488 (5th Cir. 2000)

(citation omitted). “The application of the relitigation exception is an issue of

law, and therefore this [C]ourt reviews de novo the lower court’s determination

that an injunction may be issued under that exception.” Id. 

B. Discussion

The issue on appeal is the permanent injunction issued by the district

court on January 2008. Gunderson appeals the portion of the injunction which

enjoins claims against First Health and/or its “unidentified payors.” Gunderson

does not appeal the permanent injunction applicable to claims against Liberty

Mutual. 

Gunderson makes four basic arguments to supportthe conclusion thatthe

district court erred in granting a permanent injunction in favor of First Health

and its payors: (1) that the district court improperly applied the All Writs Act

and the relitigation exception of the Anti-Injunction Act; (2) that the district
No. 08-30075

7

court lacked subject matter jurisdiction; (3) that the absence of a judgment

between Gunderson and First Health precludes the relief granted by the district

court; and (4) that including First Health’s “payors” within the scope of the

injunction rendered the injunction too general to pass muster under Federal

Rule of Civil Procedure (“Rule”) 65. 
No. 08-30075

8

1. All Writs Act and the Relitigation Exception

Gunderson contends thatit was improper for the district courtto rely upon

the All Writs Act and the relitigation exception to the Anti-Injunction Act to

enjoin Gunderson from pursuing claims pending in both Louisiana state court

and in the OWC. As explained in Regions Bank v. Rivet, this Court utilizes a

four-part test to determine whether the relitigation exception to the AntiInjunction Act applies to preclude litigation of a claim in state court. 224 F.3d

at 488. Specifically, 

(1) “the parties in a later action must be identical to (or at least in

privity with) the parties in a prior action”; (2) “the judgment in the

prior action must have been rendered by a court of competent

jurisdiction”; (3) “the prior action must have concluded with a final

judgment on the merits”; and (4) “the same claim or cause of action

must be involved in both suits.”

Id. (5th Cir. 2000) (citations omitted). Gunderson argues that these

requirements are not met in this case. We disagree. This section will address

Regions Bank factors one, three, and four. Factor two is discussed below as it is

related to a separate claim made by Gunderson.

A. Factor One

To the extent that Gunderson attempts to bring any claims, whether in

federal court, state court, or the OWC, against Liberty Mutual involving the

district court’s ruling at the summary judgment stage, the parties in the future

actions would be identical, and res judicata applies. Vines v. Univ. of La., 398

F.3d 700, 709 (5th Cir. 2000). Gunderson does not dispute that he is precluded

from bringing any claims of this nature against Liberty Mutual. 

Further, this Court finds that First Health and its “payors” are in privity

withLiberty Mutual.“Privity is a ‘legal conclusion thatthe relationship between

the one who is a party on the record and the non-party is sufficiently close to

afford application of the principle of preclusion.’” Id. at 706. As this Court

explained in Howell Hydrocarbons, Inc. v. Adams, a party is in privity with a
No. 08-30075

4 On May 9, 2006, Gunderson appealed the district court’s grant of

summary judgment. This Court dismissed the appeal for lack of jurisdiction in

a per curiam opinion without explanation. Based on the briefs filed, this Court

finds that the appeal was dismissed for lack of jurisdiction because Gunderson

improperly attempted to appeal the district court's denial of a 12(b)(6) motion to

dismiss. See Appellee's Mot. to Dismiss the Appeal for Lack of Juris. in Liberty

Mutual Insurance Co. v. Gunderson, No. 06-30545, (5th Cir. 2006) (unpublished

decision). Gunderson failed to brief the only appealable issue, the district court's

grant of summary judgment in favor of Liberty Mutual, and therefore abandoned

that issue on appeal. 

9

party for res judicata purposes “if the party adequately represented his interest

in the prior proceeding.” 897 F.2d 183, 188 (5th Cir. 1990). Liberty Mutual and

other “payors” entered into Provider Agreement contracts with First Health.

Liberty Mutual and First Health actively disputed Gunderson’s claims that (1)

the discount provisions contained in the Provider Agreements are unenforceable,

and (2) that the payment provisions contained in the Provider Agreements do

not apply to group purchasers or to agreements of group purchasers. The

contractual relationship between First Health and its payors, as well as the

identical litigation position against Gunderson in suits over these contractual

provisions, evidence to this Court that First Health and its “payors” are in

privity with Liberty Mutual. Factor One is satisfied.

B. Factor Three

Factor Three requires thatthe prior action conclude with a final judgment

on the merits. The district court’s use of the relitigation exception and decision

to issue a permanent injunction were based on its summary judgment ruling in

favor of Liberty Mutual. Gunderson abandoned any ability to appeal the district

court’s summary judgment ruling.4 Factor Three is satisfied. 

C. Factor Four

Factor Four requires that both disputes involve the same claim or cause

of action. The claims at issue in the instant case, and the claims filed by

Gunderson in the OWC, all involve discount and payment provisions inProvider
No. 08-30075

5 The findings in the other cases are irrelevant; however, this Court notes

that the district court distinguished the instant case from each one of the

decisions cited by Gunderson to argue that the district court lacked subject

10

Agreements between First Health and Gunderson. First Health’s payors

provided payments to Gunderson under the provisions found in these Provider

Agreements between First Health and Gunderson. Gunderson repeatedly

attempted to make claims againstFirst Health’s payors, arguing thatthe payors

improperly discounted rates for their services under these Agreements, despite

the district court’s rejection of that very argumentin its ruling that the Provider

Agreements are valid and enforceable. 

In addition, collateral estoppel precludes Gunderson from pursuing any

future claims that would involve relitigating the issues decided by the district

court when it granted summary judgment against Gunderson. Vines, 398 F.3d

at 709 (explaining that collateral estoppel requires the same issue, fact, or law

be actually litigated and determined in a prior judgment). Gunderson is barred

from attempting to bring a claim in federal court, state court, or the OWC that

would involve deciding the validity of the discount or payment provisions

contained in Provider Agreements between First Health and its payors. The

district court decided these issues on summary judgment, and Gunderson

abandoned its appeal of the rulings contained in the district court’s grant of

summary judgment. Factor Four is satisfied. 

2. Subject Matter Jurisdiction (Regions Bank Factor Two)

Gunderson alleges that the district court did not have subject matter

jurisdiction to decide the instant case. To demonstrate the district court’s lack

of subject matter jurisdiction, Gunderson points to similar lawsuits where the

same district court found that it lacked jurisdiction. See Sentry v. Lake Charles

Mem’l, 2:06-cv-00570 (W.D. La. June 4, 2008); AIG v. Gunderson, 2:05-cv-247

(W.D. La. May 11, 2005); Gunderson v. F.A. Richard & Assocs., 2:04-cv-1242

(W.D. La. Mar. 23, 2005).5 Gunderson, however, in making this argument
No. 08-30075

matter jurisdiction. On de novo review, this Court must make an independent

determination regarding subject matter jurisdiction. 

11

ignores that the district court had proper diversity jurisdiction over this case.

The Supreme Court explained in Horton v. Liberty Mutual Insurance Co. that

state workers’ compensation claims may be removed to federal district courts if

diversity jurisdiction exists. 367 U.S. 348, 352 (1961). Regions Bank Factor Two

requires the court have “competent”jurisdiction, but does not specifically require

that the court using the relitigation exception to the Anti-Injunction Act have

subject matter jurisdiction over the case. Regions Bank, 224 F.3d at 488

(citation omitted). The district court properly found that it maintained diversity

jurisdiction over this case.

3. Final Judgment on the Merits Between Gunderson and First Health

Gunderson next argues that the district court erred in issuing the

injunction, because “Plaintiffs in both suits must have asserted the same claim

or cause of action, the federal court’s underlying judgment must be ‘final’, [sic]

and the federal and state proceedings mustinvolve identical parties.” Gunderson

then provides a citation to Regions Bank. Gunderson misunderstands what is

required by the relitigation exception. The four factor test outlined in Regions

Bank does not require a final judgment on the merits between Gunderson and

First Health. Regions Bank, 224 F.3d at 488 (citation omitted). The test does,

however, require a final judgment on the merits. As discussed above, the district

court issued a final judgment when it granted summary judgment in favor of

Liberty Mutual. While this Court acknowledges that the grant of summary

judgment was limited to a finding in favor of Liberty Mutual, we also find that

First Health and its payors are in privity with Liberty Mutual for purposes of

the relitigation exception. The district court specifically ruled on the validity of

Provider Agreements entered into between Gunderson and First Health in its

summary judgment ruling. 
No. 08-30075

12

4. Federal Rule of Civil Procedure 65

Gunderson argues that enjoining actions against parties who are not

identified (or identifiable without initiating litigation), violates the rule of

specificity for injunctions. Gunderson asserts that the permanent injunction is

impermissibly vague, overbroad and hard to ascertain in that it fails to name or

otherwise identify the ‘payors’ of First Health. Rule 65(d) requires specificity;

“[a]n injunction must simply be framed so that those enjoined will know what

conduct the court has prohibited.” Meyer v. Brown & Root Constr. Co., 661 F.2d

369, 373 (5th Cir. 1981). The district court correctly noted that the Provider

Agreements between First Health and Gunderson required First Health to

provide a payor listing to Gunderson. Liberty Mutual, No. 04-cv-2405, slip op.

5-6 (Mem. Ruling). First Health complied with these requirements, and

provided Gunderson with payor listings. Therefore, this Court holds that the

permanent injunction is framed in a manner that enables Gunderson to know

what conduct the district court prohibited. 

IV. CONCLUSION

For the foregoing reasons, First Health’s motion to dismiss for lack of

jurisdiction is DENIED. The district court’s grant of a permanent injunction

against Gunderson is AFFIRMED.