When Blake Lively heard on Monday that a judge had dismissed Justin Baldoni's $400 million defamation lawsuit against her, she reportedly 'cried with relief.'

Well, Lively better keep those tissue boxes close, because well-connected Los Angeles lawyers who spoke exclusively to the Daily Mail say her legal drama may not end the way she envisions.

For six months, the 37-year-old actress had been in the eye of a storm – one sparked by her decision in December to sue her former co-star and director Baldoni, accusing him of sexual harassment on the set of their film It Ends With Us and of starting a smear campaign against her.

'I don't think this will be over any time soon,' said veteran trial attorney Omar Serrato. 'I think we have a long way to go.'

Back in January, Baldoni and his production company countersued Lively, her husband Ryan Reynolds, their publicist Leslie Sloan and the New York Times - accusing them of defamation and extortion.

Then on Monday, Judge Lewis J Liman dismissed the defamation and extortion claims with prejudice, meaning they cannot be simply amended and refiled. Two additional counts - accusing Lively of 'tortious interference with contract and breach of implied covenant' - were also dismissed (though the judge will allow Baldoni to amend and refile those allegations).

When Blake Lively (pictured on June 9) heard that a judge had dismissed Justin Baldoni 's $400 million defamation lawsuit against her, she reportedly 'cried with relief.'

Lively sued her former co-star and director Justin Baldoni (pictured at the NYC 'It Ends With Us' premiere) in December, accusing him of sexual harassment on the set of their film 'It Ends With Us' and of starting a smear campaign against her.

It was Liman's judgement that Baldoni failed to adequately allege that Lively and Reynold knowingly made false statements to defame him, yet - Serrato believes - that plaintiffs typically aren't required to present such proof so early in the proceedings.

'I thought Judge Liman would reserve judgement until the conclusion of discovery,' said Serrato, referencing the process during where parties in a lawsuit exchange information and evidence in preparation for trial.

According to Serrato, Monday's decision provides Baldoni an opportunity to appeal the ruling: 'I was surprised. It certainly feels like it may be in danger of appellate review.'

Furthermore, Serrato believes that Lively's harassment case against Baldoni is weak, undermined by a torrent of text messages, emails, videos and conflicting statements made by others on set.

For instance, an May 2023 email that Lively sent Baldoni depicting a close relationship between the two has been revealed in court documents.

'I'm grateful for all we've built so far. Thank you for caring so much and for putting every bit of you into showing it,' Lively wrote.

About a week later, Baldoni messaged Lively to say: 'I'm not going to tell you that you were amazing because you tease me for being so sentimental – but you were amazing today.

'Thank you I do appreciate it,' Lively wrote back. 'I'm just a ball buster but it means a lot to me. I care a great deal. And always want to deliver… You were terrific. I'm proud of everything we did today, but really every day.'

Indeed, Baldoni's team have scoffed at Lively's jubilation, with his lawyer Bryan Freedman calling Monday's decision a 'false' victory for Lively, adding that her allegations are 'no truer today than they were yesterday' and insisting his case is still alive.

Baldoni himself has reportedly been left disappointed, but a source close to the 41-year-old told the Daily Mail that he trusted his legal team and was 'looking to figure out how to move forward from this current setback.'

Top Los Angeles celebrity lawyer Christopher Melcher disagreed, however, arguing Baldoni's case is finished – but that doesn't mean Lively is riding high.

Melcher, a partner at Walzer Melcher and Yoda, said Liman's decision to throw out the substantive sections of Baldoni's case was predictable, explaining that litigants accusing someone of sexual harassment usually enjoy broad protections from defamation claims.

'There is strong first amendment and other legal protections for anyone making claims of abuse, particularly claims of sexual harassment in the workplace,' said Melcher.

'Those types of complaints need some protection around them, otherwise a very powerful person or corporation could just turn around and sue for defamation every time a complaint was made against them,' he added.

Back in January, Baldoni and his production company countersued Lively; her husband Ryan Reynolds ; their publicist Leslie Sloan; and the New York Times accusing them of defamation and extortion.

On Monday, Judge Lewis J Liman dismissed the defamation claims with prejudice, meaning they cannot be simply amended and refiled. Two additional counts accusing Lively of usurping his control of the film were upheld. (Pictured: Lively and Baldoni in 'It Ends With Us'). 

But Melcher believes Judge Liman's decision may – ironically – convince Lively to gracefully back out of her own lawsuit as well.

Last week, Lively officially withdrew two claims of emotional distress after Baldoni lawyers filing a motion to compel her to turn over her medical records.

A plaintiff claiming 'emotional distress' is often required to provide proof of their injuries, which may be verified through therapist notes.

Melcher said that was 'a fatal blow' to her case, cutting out the legs of her argument.

'Because of that decision, the judge said she cannot put on evidence of emotional distress, which is the main component of her claim,' he explained.

And as the result of this legal wrangling, Melcher believes, both Lively and Baldoni's cases are no longer viable.

'Both of them have just really destroyed each other in this court proceeding and have accomplished nothing, other than harming themselves,' he said.

Judge Liman has set a provisional March 2026 court date for the start of Lively's sexual harassment case, but Melcher expects things to wrap up before then.

'I see no realistic chance that this case will ever go to trial,' he said. 'Justin has very little claims left that are allowed based on this ruling and Blake can't seek emotional distress damages.'

That may provide Lively the fig leaf – that Melcher believes she's seeking – which will allow her to tactfully withdraw her own lawsuit and move on from this intensely bruising drama.

'I felt that Blake has been wanting an off-ramp for a very long time, because when she kicked this off, she put on the mantle of a victim very well, and there were a lot of people who rallied behind her in support,' he said.

'But when Justin fought back, it looked like Blake was really the aggressor, and she came out looking horrific, and now she has an opportunity to claim victory and get out of the case.'

Baldoni himself was reportedly disappointed by Judge Liman's decision, but a source close to the 41-year-old told the Daily Mail that he trusted his legal team and was 'looking to figure out how to move forward from this current setback.'

Finally, Melcher suspects that Lively will chose to move her fight to the court of public opinion.

'She can now try to build her own narrative [...] with publicists, rather than doing it in a courtroom where she's subject to scrutiny and depositions and other questions that are nagging against the truth,' he advised.

And Melcher felt that the judge, who has repeatedly raised his eyebrows about the messy spectacle they were subjecting themselves to, may be guiding both parties to this conclusion.

'They have inflicted damaging wounds against the other,' said Melcher. 'The only thing they have to show for it are big legal bills, and now they really need to find a way out, because going forward in court is not a viable pathway for either one of them based on the rulings that they have suffered in the last week.

'It's really now in their hands to settle, and that might be what the judge is hoping to do through these rulings.'