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Blake Lively and Justin Baldoni are continuing their legal battle in New York court despite announcing a settlement of their main dispute weeks ago, with one significant disagreement still unresolved over legal fees and additional damages.

The two co-stars of the 2024 film “It Ends With Us” reached an agreement to resolve their contentious legal dispute just weeks before a trial was scheduled to commence, where both actors were expected to testify. However, the settlement notice filed in Manhattan federal court contains an exception that allows Lively to continue pursuing legal fees and additional compensation from Baldoni and his associates in a case.

Lively’s attorneys confirmed in a court filing that “The parties have fully and finally resolved claims in the consolidated action, except one,” referring to her pursuit of legal fees that could potentially involve millions of dollars and trigger several more weeks of litigation. Baldoni is contesting this claim in court, preventing the case from being completely closed.

The legal saga began in December 2024 when Lively filed a complaint with the California Civil Rights Department, alleging “severe emotional distress” after she claimed Baldoni and key stakeholders in the film sexually harassed her and attempted to orchestrate a smear campaign against her. She later formalized her complaint into a lawsuit against Baldoni in New York on December 31, 2024.

Baldoni filed a $400 million counter-lawsuit against Lively, her husband Ryan Reynolds, their publicist Leslie Sloane, and Baldoni’s production company Wayfarer Studios, accusing them of extortion and defamation. However, a judge dismissed Baldoni’s lawsuit in June 2025 after he failed to meet a necessary deadline to advance his claim.

In April 2026, a federal judge in New York dismissed 10 out of 13 claims in Lively’s lawsuit, including those to harassment and defamation, leaving only three claims: breach of contract and retaliation. Baldoni has consistently denied all allegations of harassment, asserting that Lively fabricated the accusations as part of a strategy to gain creative control over the film.

The matter remains ongoing in court, with the unresolved dispute over legal fees keeping the courtroom doors open for both parties despite their announced settlement.