Lisa Vanderpump -- Former Villa Blanca Waitress Makes ABSURD Settlement Offer

This is one for the books. The woman who was suing Lisa Vanderpump for $5 million alleging sexual harassment at her Villa Blanca restaurant -- among other things, is now willing to settle for $40K if the restaurant acknowledges some ridiculous things.

Karina Bustillos -- who claimed a Villa Blanca manager sexually harassed her in all sorts of ways -- says she'll drop the suit if she gets $40K and the following promises from Villa Blanca:

-- not to serve catfish and claim it's the more expensive tilapia
-- not to serve canned fruits and veggies and call them fresh
-- teach employees not to eat food off customers' plates
-- order kitchen staff to wash their hands frequently

And there's other stuff too, which seems like it's designed to embarrass.