Blake Lively seeks penalties in Justin Baldoni case as court fight reignites after settlement

The courtroom dispute between actors Blake Lively and Justin Baldoni is continuing to unfold even after both sides recently signaled a resolution.

The pair had reached a settlement just a month ago, seemingly putting an end to litigation tied to Lively’s allegations that Baldoni orchestrated a smear campaign against her after she accused him of sexual harassment during production of their 2024 film It Ends With Us. The deal was expected to avert a trial.

However, on Monday, according to the Associated Press, Lively’s legal team returned to court in New York, asking a judge to order Baldoni to cover her legal expenses and impose additional penalties. Her lawyers argued she is entitled to reimbursement under California law, pointing out that Baldoni’s counterclaims which accused her of defamation and extortion had previously been dismissed by a judge.

Neither Lively nor Baldoni appeared in person at the hearing before U.S. District Judge Lewis J. Liman.

Baldoni’s attorney, Ellyn Garofalo, according to AP, pushed back in court, accusing Lively of attempting what she described as an “end run” around a settlement that had effectively halted trial proceedings. She noted that the private agreement resolved the dispute without Baldoni or his production company paying any portion of the $300 million in damages Lively had originally sought. Reopening the matter now, she argued, would effectively revive a full trial process, including renewed discovery and expert testimony.

Lively’s lawyer, Michael Gottlieb, countered that Baldoni’s lawsuit was precisely the kind of legal action California’s anti-retaliation protections were designed to discourage, particularly in cases involving allegations of workplace sexual misconduct.

Judge Liman did not issue an immediate ruling after hearing more than an hour of arguments.

The broader dispute between the two stars dates back to late 2024, surrounding the production of “It Ends With Us.” Lively alleged that Baldoni made inappropriate remarks about her appearance, crossed physical boundaries during intimate scenes, and pressured her to perform nude in a childbirth sequence against her wishes. She also accused him and his production company of later coordinating a campaign to undermine her reputation should she speak publicly about her concerns.

Baldoni, who directed and co-starred in the film, has denied all allegations, saying instead that Lively fabricated the claims in an attempt to gain creative control. He later filed a countersuit accusing Lively and her husband, actor Ryan Reynolds, of defamation and extortion.

A federal judge previously dismissed Lively’s sexual harassment claims, ruling they could not proceed under federal law because she was classified as an independent contractor rather than an employee on set. However, her retaliation-related claims were still headed toward trial before the settlement was reached.

Following the agreement, both sides issued a joint statement saying Lively’s concerns “deserved to be heard” and reaffirming their commitment to safe and respectful working environments.