LOS ANGELES — The settlement that was announced Monday between Blake Lively and Justin Baldoni looked like the end of one of Hollywood's messiest recent legal fights.

Not quite.

Attorneys for Lively said on Thursday that she will continue pursuing damages against Baldoni and other defendants under a California law aimed at deterring retaliatory defamation lawsuits tied to sexual harassment claims.

Although the parties agreed Monday to dismiss the broader lawsuit, Lively is still seeking attorneys' fees, punitive damages and other financial penalties stemming from Baldoni's failed $400 million defamation countersuit against her, which U.S. District Judge Lewis J. Liman dismissed last year.

In a sharply worded statement issued Thursday, Lively's attorneys Michael Gottlieb and Esra Hudson described the settlement as "a resounding victory for Blake Lively" and argued that Baldoni and the other defendants now face potential personal liability under California Civil Code Section 47.1.

"By agreeing to this settlement, and waiving their right to appeal, Justin Baldoni and every individual defendant now face personal liability for abusing the legal system to silence and intimidate Ms. Lively," the attorneys said.

The attorneys also argued that the settlement and the parties' joint statement issued Monday undermined earlier claims that Lively fabricated allegations of harassment and retaliation.

"From day one Blake Lively's mission was clear: expose and hold accountable those who weaponize smear campaigns and retaliatory lawsuits to intimidate and silence survivors," the statement said. "That mission continues."

Baldoni attorney Bryan Freedman rejected that characterization, calling the outcome "a win and total victory for the Wayfarer parties."

"The court had already dismissed 10 of Ms. Lively's 13 claims, including every sexual harassment claim, every defamation claim, and all claims against the individual defendants," Freedman said in a statement. "Ms. Lively voluntarily dismissed the rest. In our view, they settled because they knew they were going to lose in court."

Freedman described the remaining Section 47.1 dispute as "a pending request for fees based on a very narrow issue that has been with the court since September 2025."

The legal and public relations feud has stretched on for well over a year. Lively sued Baldoni, his production company Wayfarer Studios and others in December 2024, alleging sexual harassment, retaliation and other claims tied to her experience on the romantic drama "It Ends With Us," which Baldoni directed and co-starred in opposite Lively. The complaint described a pattern of alleged conduct that included producers showing nude videos and images of women, comments about Lively's weight and unwanted physical touching and sexual remarks without her consent.

Baldoni denied the allegations and argued in court filings that the dispute had been mischaracterized. His side accused Lively of distorting events on set and filed a defamation suit seeking $400 million in damages against Lively, her husband Ryan Reynolds and others. That countersuit was later dismissed.

The legal fight over Section 47.1 has been central to the case for months. In March of last year, Lively moved to dismiss Baldoni's countersuit by invoking the California statute, arguing that it protected individuals who publicly report allegations of sexual misconduct from retaliatory defamation claims.

The statute, enacted in California in the wake of the #MeToo movement, was designed to shield individuals who report sexual harassment or retaliation from retaliatory litigation and allows prevailing defendants to seek attorneys' fees, treble damages and punitive damages in certain circumstances.

At the time, Lively's attorneys argued that Baldoni's claims amounted to "weaponizing defamation lawsuits" against someone who had spoken publicly about harassment and retaliation. Freedman blasted the motion as "one of the most abhorrent examples of abusing our legal system."

Before the settlement — the terms of which were largely confidential — the case had been headed toward a May trial expected to focus largely on Lively's claims that Baldoni, his associates and outside public relations consultants retaliated against her by attempting to damage her reputation online and in the press after she raised concerns about conduct on the film.

Under the settlement stipulation, both sides agreed to waive any appeal of the court's eventual ruling on the 47.1 motion, leaving the next — and possibly final — phase of the dispute largely in the hands of Judge Liman.

©2026 Los Angeles Times. Visit latimes.com. Distributed by Tribune Content Agency, LLC.