Blake Lively Lawsuit News: Countersuit, Settlement, and Fees

The Blake Lively lawsuit against her It Ends With Us co-star and director Justin Baldoni, filed December 31, 2024, in the Southern District of New York, ended in a May 2026 settlement that paid Lively nothing but preserved her right to pursue attorney fees, which a federal judge later awarded. Along the way, Baldoni’s $400 million countersuit was dismissed, ten of Lively’s thirteen claims were thrown out, and the case that once looked headed for a blockbuster trial closed without one.¹²

What Lively Alleged

Lively’s complaint named eight defendants, including Baldoni, Wayfarer Studios, its CEO Jamey Heath, co-founder Steve Sarowitz, the production company It Ends With Us Movie LLC, and crisis publicists Melissa Nathan and Jennifer Abel.¹ It grew out of a complaint she had filed with the California Civil Rights Department on December 20, 2024.³

Her claims came in three parts. She accused Baldoni and Heath of sexual harassment on set, including unwanted physical contact during intimate scenes, entering her trailer while she was undressed or breastfeeding, and graphic personal comments.⁴ She alleged a hostile work environment created by the disregard of industry protocols for intimate scenes.¹ And she accused the defendants of running a retaliatory smear campaign after she raised concerns, an allegation that drove the public interest in the case.

The workplace demands Lively raised in a January 2024 “all-hands” meeting were formalized in a contract rider signed on January 19, 2024, containing seventeen provisions on intimacy coordinators, nudity, and a ban on retaliation.⁵ That rider became the anchor of the claim that outlasted every other.

The public phase of the dispute opened on December 21, 2024, when the New York Times published “‘We Can Bury Anyone’: Inside a Hollywood Smear Machine,” built on subpoenaed text messages and emails between Baldoni’s PR operatives.⁶ Baldoni’s attorney, Bryan Freedman, called that evidence “cherry-picked” and said the crisis work was a routine response to threats from powerful people.⁷

Baldoni’s $400 Million Countersuit

In January 2025, Baldoni and Wayfarer Studios sued Lively, her husband Ryan Reynolds, and their publicist Leslie Sloane for $400 million, alleging defamation, civil extortion, and invasion of privacy. Baldoni also filed a separate $250 million libel suit against the New York Times.⁸⁹ The countersuit’s theory was that Lively had seized creative control of the film by threatening to refuse promotion and attack Baldoni publicly, then spread a false story of sexual misconduct.

Judge Lewis J. Liman dismissed the countersuit on June 9, 2025. Even taking Baldoni’s version as true, the court found, Lively’s conduct did not amount to civil extortion under California law and constituted “legally permissible hard bargaining or renegotiation of working conditions.”¹⁰ The defamation claims failed because Lively’s statements in her own lawsuit were privileged and Baldoni had not shown Reynolds or Sloane seriously doubted the truth of what they said.¹¹ The Times case was dismissed the same day, the judge finding the paper had “reviewed the available evidence and reported, perhaps in a dramatized manner, what it believed to have happened” and that Baldoni had not met the “actual malice” standard.¹²

Baldoni was given leave to amend certain contract interference claims by June 23, 2025, but never refiled. Judge Liman formally ended the countersuit on October 31, 2025.¹³

The April 2026 Ruling That Narrowed Lively’s Case

On April 2, 2026, Judge Liman issued a 152-page opinion dismissing 10 of Lively’s 13 claims.¹⁴ The sexual harassment claims fell on two grounds. Lively was classified as an independent contractor rather than an employee, which foreclosed certain federal civil rights claims. And her California-law harassment claims were dismissed because the filming took place in New Jersey, giving the conduct no “substantial connection” to California.¹⁵

Defamation claims tied to Freedman’s public statements were dismissed because those statements referenced allegations already before the court. Most of the smear-campaign allegations were ruled not actionable, with the judge writing that the defense was “entitled to engage public relations and crisis management specialists to protect their reputations.”¹⁵

Three claims survived and were headed for trial:

Retaliation under California’s Fair Employment and Housing Act against It Ends With Us Movie LLC and Wayfarer Studios, on conduct the court found “at least arguably crossed the line.”
Aiding and abetting retaliation against The Agency Group PR LLC.
Breach of the January 2024 contract rider’s anti-retaliation provision against It Ends With Us Movie LLC.⁵

The May 2026 Settlement

Trial had been scheduled for May 18, 2026, after being pushed back from March 9.¹⁶ It never happened. After a weekend of mediation on May 2 and 3, the parties signed a term sheet on May 4, and a formal notice of settlement was filed on May 7, 2026.²

Lively received no money. The agreement did preserve her right to pursue attorney fees and damages under California Civil Code Section 47.1, and both sides irrevocably waived any appeal of the court’s ruling on that pending motion.¹⁷

Lawyers for both sides issued a joint statement: “We acknowledge the process presented challenges and recognize concerns raised by Ms. Lively deserved to be heard. We remain firmly committed to workplaces free of improprieties and unproductive environments. It is our sincere hope that this brings closure and allows all involved to move forward constructively and in peace, including a respectful environment online.”¹⁸

Each side declared victory. Lively’s attorneys called the deal “resounding,” pointing to the appeal waiver that left Baldoni exposed on the fee motion. Freedman called it “a total victory for the Wayfarer parties,” noting that 10 of 13 claims had been dismissed and Lively didn’t receive “a cent.”¹⁹

Attorney Fees and What’s Still Open

On June 12, 2026, Judge Liman granted Lively’s request for attorney fees under California Civil Code Section 47.1, a 2023 statute enacted after the #MeToo movement to shield people who report sexual misconduct from retaliatory defamation suits.²⁰ The court found that Lively’s sexual misconduct complaints were made “without malice,” the statute’s threshold for protection, and that Baldoni’s team “produced no evidence” to overcome that finding.²¹

The dollar amount has not been set. Lively’s team is expected to submit a breakdown of hours and rates for the court to review. The judge denied Lively’s request for treble and punitive damages through the fee motion, ruling those are substantive remedies that cannot be pursued through a post-judgment fee petition under federal procedural rules. He left open the possibility of a separate lawsuit or counterclaim.²¹ The court called Section 47.1 a “novel” statute with “scant caselaw,” acknowledging that its ruling was something of a test case for how the law works in federal court.²⁰

Freedman called the fee award “a single claim in a portion of the litigation that existed for only a few months.”²²

As of mid-2026, Baldoni’s $400 million countersuit and his $250 million case against the Times are both gone. Ten of Lively’s thirteen claims have been dismissed, and the three that survived were resolved by the settlement. The fee award has been granted in principle, with the amount to be calculated. Whether Lively pursues treble or punitive damages through a separate proceeding is the last real question left.²³

1
Newsweek. Blake Lively Lawsuit Against Justin Baldoni
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Deadline. Blake Lively Settlement Details Justin Baldoni
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ABC News. Blake Lively Justin Baldoni Legal Battle Timeline
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People. Who Is Jamey Heath, It Ends With Us Producer in Blake Lively Complaint
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U.S. District Court, S.D.N.Y. Lively v. Wayfarer Studios, Opinion and Order
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The New York Times. Blake Lively Justin Baldoni It Ends With Us
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Variety. Blake Lively Justin Baldoni Crisis PR Harassment
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ABC News. Justin Baldoni’s $400M Countersuit Against Blake Lively Ended by Judge
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ABC News. Justin Baldoni Files Lawsuit Against New York Times Over Story
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BBC News. Justin Baldoni Defamation Lawsuit Against Blake Lively Dismissed
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New York Post. Justin Baldoni’s $400M Countersuit Against Blake Lively, Ryan Reynolds Dismissed
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NPR. Justin Baldoni Blake Lively Lawsuit Dismissed
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New York Post. Justin Baldoni’s $400M Countersuit Against Blake Lively, Ryan Reynolds Ends
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NBC News. Blake Lively Justin Baldoni Lawsuit Judge Dismisses Some Claims
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BBC News. Blake Lively Justin Baldoni Lawsuit Ruling
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Deadline. Blake Lively Justin Baldoni Trial Postponed
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Los Angeles Times. Blake Lively Legal Fight With Justin Baldoni Is Not Over
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NPR. Blake Lively Justin Baldoni Settle Trial It Ends With Us
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USA Today. Blake Lively Justin Baldoni Feud Settlement Analysis
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Deadline. Lively Fees Ruling
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The Hollywood Reporter. Blake Lively Legal Fees Justin Baldoni Court Orders
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The Business Journal. Judge Awards Blake Lively Legal Fees but No More Damages in Dispute Over It Ends With Us Film
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Los Angeles Times. Blake Lively Awarded Legal Fees From Justin Baldoni but Not Damages