           FIN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT  United States Court of Appeals
                                                    Fifth Circuit

                                                 FILED
                                                                        September 16, 2011

                            No. 10-51197 c/w No. 11-50089                   Lyle W. Cayce
                                 Summary Calendar                                Clerk



SYLVIA DEL BOSQUE,

                                                   Plaintiff - Appellant
v.

AT&T ADVERTISING, L.P., doing business as AT&T Advertising &
Publishing,

                                                   Defendant - Appellee




                   Appeals from the United States District Court
                         for the Western District of Texas
                              USDC No. 1:08-CV-402


Before GARZA, SOUTHWICK, and HAYNES, Circuit Judges.
PER CURIAM:*
       This appeal arises from the district court’s consolidated order denying
Sylvia Del Bosque’s motion to revoke a settlement agreement she reached with
AT&T Advertising, L.P. (“AT&T”), granting AT&T’s motion to enforce that same
agreement, and dismissing Del Bosque’s discrimination suit against AT&T. Del
Bosque argues that the district court erred in its resolution of the three motions,



       *
         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 R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR .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.
                          No. 10-51197 c/w No. 11-50089

contending primarily that she was coerced into signing the settlement
agreement and lacked capacity to consent at the time she signed it. Our review
of the record discloses no abuse of discretion on the district court’s part, and we
therefore AFFIRM.
                        I. Facts & Procedural History
      Sylvia Del Bosque filed suit against AT&T in the United States District
Court for the Western District of Texas in May of 2008. Del Bosque’s complaint,
as amended, alleged that AT&T discriminated against her in her employment
on the basis of race and sex and retaliated against her after she formally
complained to AT&T’s human resources staff, both in violation of Title VII of the
Civil Rights Act of 1964.1
      The parties engaged in settlement discussions throughout the pretrial
process, culminating in a mediation on November 18. The case did not settle on
the day of mediation, but from November 18, 2010, until November 22, 2010, the
parties continued efforts to attempt to resolve the case.          Del Bosque was
represented by counsel throughout this process. On November 22, 2010, Del
Bosque and her attorney signed a settlement agreement after making certain
handwritten changes on the face of the agreement that had been proposed by
AT&T. On November 29, 2010, AT&T’s attorney signed the agreement and
initialed the changes Del Bosque had made.
      On November 30, 2010, Del Bosque filed a pro se motion to revoke the
settlement agreement. AT&T responded by filing motions with supporting
affidavits to enforce the settlement agreement and to dismiss the case. Del
Bosque filed a response without formal evidence. As required by Mid-South




      1
      Del Bosque also asserted parallel state-law claims under the Texas Commission on
Human Rights Act, apparently under pendent jurisdiction.

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Towing Co. v. Har-Win, Inc., 733 F.2d 386, 390 (5th Cir. 1984),2 the district
court conducted a hearing on December 13, 2010, at which Del Bosque, the
attorney who represented Del Bosque at the mediation, and AT&T’s attorney
spoke. No witnesses were presented, but it appears that the district court
considered the attendees’ statements as evidence; the affidavits and exhibits
presented with the motion to enforce were also considered as evidence. The
district judge carefully and diligently listened to both attorneys and Del Bosque.
At the conclusion of the hearing, the district judge advised Del Bosque that he
intended to enforce the settlement agreement and to deny her motion to revoke
the agreement; the district court entered an order to that effect the same day but
deferred dismissal of the case until AT&T had paid Del Bosque according to the
terms of the settlement. Del Bosque filed a notice of appeal following the entry
of this order. After AT&T satisfied the court that it had paid Del Bosque, the
district court entered an order and final judgment dismissing the case with
prejudice on December 30, 2010. Del Bosque then filed a second notice of appeal,
and the two appeals were consolidated before us.
                                II. Standard of Review
       “[A] district court has inherent power to recognize, encourage, and when
necessary enforce settlement agreements reached by the parties.”                         Bell v.
Schexnayder, 36 F.3d 447, 449 (5th Cir. 1994). We review the district court’s
exercise of this inherent power for abuse of discretion. See id. at 450; see also
Deville v. United States, 202 F. App’x 761, 762 (5th Cir. 2006) (unpublished)
(“The ultimate decision to grant a motion to enforce a settlement agreement is
reviewed for abuse of discretion.”). “A district court abuses its discretion if it: (1)


       2
        “Although a district court has inherent power to enforce an agreement to settle a case
pending before it summarily, when opposition to enforcement of the settlement is based not
on the merits of the claim but on a challenge to the validity of the agreement itself, the parties
must be allowed an evidentiary hearing on disputed issues of the validity and scope of the
agreement.” Mid-South Towing, 733 F.2d at 390.

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relies on clearly erroneous factual findings; (2) relies on erroneous conclusions
of law; or (3) misapplies the law to the facts.” In re Volkswagen of Am., Inc., 545
F.3d 304, 3180 (5th Cir. 2008) (en banc) (internal quotation marks omitted).
                                      III. Discussion
       Del Bosque’s pro se appellate briefs raise a multiplicity of asserted errors
in the district court’s resolution of this case; however, most of her brief addresses
the substantive merits of her case against AT&T, which is not before us. We
address only the issue of whether the district court erred in enforcing the
settlement agreement.
       As an initial matter, we conclude that the question of the enforceability of
the settlement agreement is, under our precedent,3 to be determined by
reference to federal law, not—as AT&T would have us hold—Texas law. See
Fulgence v. J. Ray McDermott & Co., 662 F.2d 1207, 1209 (5th Cir. 1981). This
principle is especially well-established in Title VII cases, inasmuch as “Congress
has mandated a policy of encouraging voluntary settlement of Title VII claims.”
Id. The presence of a choice-of-law provision in the settlement agreement itself
logically cannot control our resolution of this question, inasmuch as the issue to
be resolved is the validity of that very agreement; Del Bosque contends that the
agreement—including the choice-of-law provision—is the product of incapacity
or coercion.4 See generally R ESTATEMENT (S ECOND) OF C ONFLICT OF L AWS § 187


       3
         We note that there is a circuit split on this question, but this circuit has not wavered
from the position we adopted in Fulgence. See, e.g., Makins v. District of Columbia, 277 F.3d
544, 547 (D.C. Cir. 2002) (recognizing split and applying state law to determine whether
enforceable settlement agreement existed in a Title VII case); Caleb Nelson, The Persistence
of General Law, 106 COLUM . L. REV . 503, 526–30 (2006) (describing split). We also note,
however, that neither side has argued that this case would come out differently under federal
law than under Texas law. Accordingly, the conflict is a “false conflict.” See Kevin M.
Ehringer Enters. v. McData Servs. Corp., No. 10-10198, 2011 U.S. App. LEXIS 14173, at *11
n.2 (5th Cir. July 11, 2011).
       4
        The case that AT&T cites for the proposition that the choice-of-law provision governs,
Oliver v. Kroger Co., 872 F. Supp. 1545 (N.D. Tex. 1994), does not support that proposition.

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cmt. b (1989) (“A choice-of-law provision, like any other contractual provision,
will not be given effect if the consent of one of the parties to its inclusion in the
contract was obtained by improper means, such as by misrepresentation, duress,
or undue influence, or by mistake. Whether such consent was in fact obtained
by improper means or by mistake will be determined by the forum in accordance
with its own legal principles.”).
       Under federal law, “‘[o]ne who attacks a settlement must bear the burden
of showing that the contract he has made is tainted with invalidity.’” Mid-South
Towing, 733 F.2d at 392 (quoting Callen v. Pa. R.R. Co., 332 U.S. 625, 630
(1948)). The burden, therefore, lay with Del Bosque to establish before the
district court that there was some basis for holding the agreement invalid. As
the district court concluded, she has not met this burden; indeed, she offered
virtually no basis for the court to rule in her favor.
       First, although Del Bosque initially suggested that she had not in fact
signed the settlement agreement that AT&T presented to the district court, she
admitted at the hearing that she had, in fact, signed the agreement.
       Second, Del Bosque asserted that she had been coerced into signing the
settlement agreement. When the court inquired as to how and why Del Bosque
felt coerced, she first stated that she had had insufficient time to review the
agreement despite having reviewed it over a weekend and having consulted with
counsel before signing. On further questioning, Del Bosque asserted only that
“everybody wanted it done” and then asked the court for a recess. She offered
no other evidence of coercion or even statements that would show coercion. The


Rather, Oliver correctly states that, “[q]uestions regarding the enforceability of settlement
agreements in diversity cases are governed by state law.” Id. at 1547 (emphasis added); see
also Lockette v. Greyhound Lines, Inc., 817 F.2d 1182, 1185 (5th Cir. 1987) (“In this case,
where jurisdiction is based upon diversity of citizenship, we will apply the substantive law of
Louisiana to determine whether the settlement agreement allegedly entered into between
Lockette and Greyhound is enforceable.”). The federal courts’ jurisdiction over this case is
predicated on the presence of a federal question under Title VII, not diversity of citizenship.

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district court did not clearly err in finding that the facts did not support the
defense of coercion. See, e.g., R ESTATEMENT (S ECOND) OF THE L AW OF C ONTRACTS
§§ 174 (invalidating assent when “physically compelled”), 175(1) (invalidating
assent when “induced by an improper threat by the other party that leaves the
victim no reasonable alternative”), 177 (invalidating assent procured through
“undue influence by the other party”) (1981).
       Third, Del Bosque argues that she lacked capacity to enter into the
settlement agreement. Del Bosque gave the district court a signed, unsworn
letter from Holli Esteban (the “Esteban Letter”), a nurse at an endocrinology
practice, addressed “To Whom It May Concern” and expressing the opinion that
“[d]ue to Ms. Delbosque’s [sic] recent worsening condition, she may not have
been in the best medical condition to enter into a legal agreement.” Although
the district court reviewed and considered the Esteban Letter, Del Bosque
affirmatively refused to allow the court to receive the letter into evidence—nor
is it at all clear that the district court could have accepted the letter as evidence
even if Del Bosque had offered it.5 Even assuming arguendo that this Letter
constituted medical evidence, it falls far short of proving “incapacity.” Other
than telling the court that she was “distraught” during the mediation, Del
Bosque offered no other purported evidence to support her claim of incapacity.
The district court’s determination of the facts was not clearly erroneous, and the
district court did not abuse its discretion in rejecting the defense of incapacity.
See, e.g., R ESTATEMENT (S ECOND) OF THE L AW OF C ONTRACTS § 12(2) (1981)

       5
          Because the Esteban Letter was not received as evidence, it was not included in the
district court’s record; Del Bosque moves this court to supplement the record on appeal with
the letter. Del Bosque also moves to supplement the record on appeal with other medical
records and documents. Our review on appeal is necessarily limited to the record developed
before the district court, see Martco Ltd. P’ship v. Wellons, Inc., 588 F.3d 864, 872 (5th Cir.
2009); Del Bosque cannot introduce new evidence before this court. Because the district court
at least stated that it considered the Esteban Letter, we will GRANT the motion to
supplement as to this letter only. Del Bosque’s pending motions to supplement the record are
DENIED in all other respects.

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(limiting lack of capacity to extend only to persons who are under guardianship,
minors, mentally ill, or intoxicated); see generally Mandell & Wright v. Thomas,
441 S.W.2d 841, 845 (Tex. 1969) (a person has “the mental capacity to contract
if she appreciated the effect of what she was doing and understood the nature
and consequences of her acts and the business she was transacting”).
       Instead of being a case about incapacity or duress, this seems to be a case
where Del Bosque expected the mediation to give her a feeling of closure that she
did not get. Del Bosque argued to the district court (and on appeal) that there
was no “meeting of the minds” as to the settlement agreement. On further
questioning from the district court, Del Bosque explained that the basis for her
argument was that the mediation did not resolve, and the settlement agreement
was not predicated upon, the full resolution of certain fact questions that Del
Bosque had wanted the court to resolve when she filed the lawsuit. For example,
it did not resolve whether the circumstances of her departure from AT&T
constituted termination, retirement, or a disability release.                 However, she
expressed no misunderstanding or mistake about the terms of the settlement
agreement itself.      Instead, at the hearing, Del Bosque confirmed that she
understood the amount of money that she would receive under the agreement
but nevertheless argued that the agreement was invalid because it did not
explain how the agreement arrived at that amount.
       Del Bosque appears to have been under the misimpression that reaching
an agreement on stipulated facts was somehow a required precursor to the
mediation process.6 That is not so: as the district court explained, frequently the
opposite is the case—a mediated agreement reaches an ultimate disposition that



       6
         As Del Bosque told the district court at the hearing: “I was previously told when I was
pro se to get with [AT&T’s attorney] in regards to stipulated facts because, if we’re mediating
something, I think it’s critical to know what we’re mediating on and we have to agree on the
facts.”

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fundamentally avoids the resolution of disputed facts. “[S]ettlement is a process
of compromise in which, in exchange for the saving of cost and elimination of
risk, the parties each give up something they might have won had they
proceeded with the litigation, rather than an attempt to precisely delineate legal
rights.” United States v. Tex. Educ. Agency, 679 F.2d 1104, 1108 (5th Cir. 1982)
(internal quotation marks and citations omitted). Ultimately, it seems that this
misapprehension of the process, rather than any misunderstanding as to the
terms of the agreement, drove Del Bosque’s motion. A misunderstanding that
does not “ha[ve] a material effect on the agreed exchange of performances” has
no effect on the validity of the contract. R ESTATEMENT (S ECOND) OF THE L AW OF
C ONTRACTS § 153 (1981); see also id. § 152 cmt. a (“Relief is only appropriate in
situations where a mistake . . . has such a material effect on the agreed exchange
of performances as to upset the very basis for the contract.”).
      Del Bosque was represented when she negotiated and entered into the
agreement. To the extent that Del Bosque’s argument is predicated on an
alleged misunderstanding of the legal effect of the contract, the fact that she was
represented by retained counsel seriously undercuts that position.              Cf.
Stipelcovich v. Sand Dollar Marine, Inc., 805 F.2d 599, 606 (5th Cir. 1986)
(noting, in a maritime case, that, “it is difficult to make out a claim of lack of
understanding of rights or the consequences of releasing those rights” when a
party “was represented by counsel of her own choosing,” even if she also
“allege[d] that she was misinformed, uninformed, confused, and had a lack of
business understanding”).
      We therefore perceive no abuse of discretion in the district court’s decision
to enforce the settlement agreement on this record. The district court acted
within its discretion in refusing to set aside a facially valid settlement
agreement on the basis of the sparse evidence offered by Del Bosque in support
of her motion. The district judge very patiently gave her every opportunity to

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say whatever she wished at the hearing—even granting her request for a recess
to allow her to consider what she wanted to say. The court then issued a ruling
well-grounded in the facts (and lack of facts) presented. No more was required.
      AFFIRMED. MOTIONS GRANTED in part, DENIED in part.




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