The "resilient and grounded" Justin and Emily are focusing "on family and moving forward," another source adds.
Justin Baldoni is focused on what matters after settling his legal case with Blake Lively.
The It Ends with Us director-star, 42, has been building a new life in Nashville with wife Emily for the past few months, according to a source. Baldoni and the Swedish actress married in 2013 and share two children, daughter Maiya Grace, 10, and son Maxwell Roland-Samuel, 8.
"It's obviously been an incredibly difficult time for the whole family, but Nashville has given them a fresh start," says an insider.
On Monday, May 4, lawyers for Justin and Lively, 38, announced in a joint statement that an agreement had been reached before a trial that was set to take place in New York starting May 18. Both sides then declared victory after months of legal back-and-forth.
Lively first filed a sexual-harassment complaint in December 2024 against Baldoni and his company Wayfarer Studios, alleging misconduct and a smear campaign connected to their 2024 Colleen Hoover adaptation It Ends with Us. Baldoni denied the allegations.
"Justin and Emily are both incredibly resilient and grounded," the insider says. "Justin's not someone who sits around dwelling on the past and feeling sorry for himself."
"Right now, their focus is really on family and moving forward," the insider continues.
The settlement agreement, reviewed by PEOPLE, declares that Lively can still pursue legal fees and damages against Baldoni and parties at his production company Wayfarer Studios, whose $400 million defamation countersuit against Lively was dismissed by Judge Lewis J. Liman last June. Ten of Lively's 13 claims against Justin were dismissed by the judge in April, including her sexual harassment claim.
The Jane the Virgin alum was "ecstatic at the results of this and the settlement itself," Baldoni's lawyer, Bryan Freedman, told Extra on Tuesday, May 5. He and his collaborators "are very pleased with where this ended up."
The Baldoni family made Tennessee their home in late 2025. Despite their "very difficult time" since December 2024, "Nashville has been so welcoming," says a second insider close to Baldoni.
"It's been a kind and healing place for them without all the noise," the second insider says.
Baldoni is among the producing team of Dinner with Audrey, an upcoming biopic starring Thomasin McKenzie as Audrey Hepburn and Ansel Elgort as Count Hubert de Givenchy. Lively's next project is the action-rom-com The Survival List.