A newly surfaced court filing is putting numbers behind the backlash surrounding Blake Lively and Justin Baldoni’s contentious court battle, linking negative press to declining sales and growing concern among major retail partners.
Lively’s Betty Buzz brand saw a sharp shift beginning in mid-August of 2024, as her “It Ends With Us” press tour ramped up. At the center of the backlash was a surge in criticism labeling Lively and the brand as “tone-deaf,” a characterization industry insiders said can be particularly damaging in today’s social media environment.
“Being called tone-deaf is commercially devastating for a celebrity brand because it tells consumers they’re out of touch with the real world and the audience that made them valuable in the first place,” branding expert Evan Nierman told Fox News Digital. “With today’s social media climate, once that label takes hold it changes the way people interpret everything the brand does next, and becomes the lens through which every product, post and public appearance gets judged.”
That shift in perception can translate into a direct impact on consumers, especially for lifestyle brands built on personal connection.
“When the once-polished exterior begins to tarnish, crack, and fade, that consumer connection fades with it,” Doug Eldridge, founder of Achilles PR, told Fox News Digital. “Statistically speaking, this correlation is even stronger within female consumer spending habits and their opinion of the celebrity on the other side of the brand. Looking at the court filings, when you connect the dots and form a trend line, there is a demonstrable overlap between the public souring on Lively and the retail market decline. ‘I don’t need this, but I want this; the more I read, learn, and hear, I’m not sure I really want this anymore.’”
The internal documents, obtained by Fox News Digital, also suggested the backlash didn’t stay online. In one communication, a Betty Buzz employee warned that “negative” press coverage was impacting Lively’s brand after a phone call with Kroger, while another message described partners as “spooked” by the controversy.
“Unfortunately, there is a negative taste in Kroger’s mouths based on the BL interview (press) from the movie, and they said they will be closely monitoring sales on the brand,” an internal email, obtained by Fox News Digital read. “They are expecting a negative sales impact, and they’re wondering what BL will be doing to course correct and make things right with her audience. This is the first direct feedback I’ve heard from a retailer, so I wanted to share. There are likely others.”
The VP of Food and Beverage at Princess Cruises wrote, “By the way our legal and ethics compliance committee board spooked with Blake !!! I am working things out hopefully will not have any affect !”
It was the kind of behind-the-scenes alarm that crisis PR professionals say often marks the beginning of a larger fallout.
“When a celebrity starts generating headlines for the wrong reasons, corporate partners move fast to protect themselves,” Nierman, founder and CEO of crisis PR firm Red Banyan, told Fox News Digital. “Companies work with famous people because they want borrowed trust, borrowed attention, and borrowed glamour, but when that celebrity brings controversy instead of confidence, brand teams immediately start asking themselves whether the upside is still worth the risk.”
Most brand partnerships come with a “morality clause,” according to Eldridge.
“In simplest form, any statement or action made by the endorser – whether criminal or otherwise – which degrade the public perception or reputation of the individual, can initiate a for cause termination by the sponsor. Why? Because the endorser is effectively the ‘face’ of the company; when that face gets mud on it, the company gets dirtied in the process, as well,” the branding expert explained to Fox News Digital.
Companies view this less as “cancel culture” and more as modern reputational risk management, according to one crisis and reputation management expert.
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“Consumers today expect brands and public figures to align with certain values and cultural expectations, and companies monitor that closely,” Dave Quast, founder of EDQ Strategies, told Fox News Digital. “That is not entirely new; what’s changed is the speed and scale of online reaction. The phrase ‘cancel culture’ can oversimplify situations that are often more complicated. In many cases, brands are reacting not only to public criticism itself, but to uncertainty, unpredictability, and fear of prolonged controversy.”
The brand fallout has continued to unfold alongside the resolution of Lively’s legal battle with Baldoni. The two announced they had settled their nearly two-year legal battle in a joint statement shared Monday.
The “It Ends with Us” stars were set to face off in court on May 18.
No details of the settlement have been released as Baldoni’s lawyer hinted the two are still ironing out an agreement as of Tuesday. “I think where the parties are is … people are working on an agreement and the terms of an agreement and I think in concept certain major points have been agreed to, which we’re very pleased with,” Freedman said during an appearance on “Hot Mics with Billy Bush.”
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“And you know, as they say the devil is in the details and we’ll see what the agreement looks like and work on that agreement,” Freedman added. “But … we’d like to believe we have an agreement.”
Following the announcement of the settlement, attention will shift to whether the damage is temporary – or lasting. Settlements are often beneficial because they eliminate uncertainty, Quast explained. “The entertainment and consumer-brand worlds are full of examples where public backlash appeared severe in the moment but faded over time,” he told Fox News Digital.
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But others caution that a resolution in court does not automatically repair brand damage.
“The settlement gives retail partners the one thing they were missing, which is a reason to stop bracing for the next legal bombshell,” Nierman added. “It does not magically restore confidence, but it gives them permission to look at the brand again without wondering whether tomorrow’s headline will drag them into the fight.”
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“A celebrity brand can recover, but it has to earn its way back. The public will move on from the lawsuit, but retailers are going to care about whether consumers are still buying, still engaging and still willing to separate the product from the press.”
As Lively steps back into the spotlight, including a recent high-profile appearance at the Met Gala, the question remains whether the backlash marks a temporary setback or a longer-term shift in how consumers view her brand.
Eldridge argued it’s too early to write off a comeback.
“America is a country of second chances, and we love the comeback story,” he told Fox News Digital. “She has a real opportunity, regardless of the self-inflicted nature of her current condition. But just like non-essential, lifestyle products—which we don’t need to purchase in the first place—if we don’t like you and don’t want to be around you, then we certainly won’t support you by investing in you. The steady quarterly decline is evidence of this reality. This is a rare instance where feelings become facts.”
