Blake Lively is taking it one day at a time after filing a lawsuit against Justin Baldoni.

Days after the actress sued her It ends with us Director and co-star for alleged sexual harassment followed by a public smear campaign to “destroy” her reputation, a source tells PEOPLE that Lively, 37, was surrounded by her loved ones: “She enjoyed the holidays and tried “very, good to live in the moment right now.”

The insider says Lively is “in touch with her team” and “knows she’s going to have an explosive start to the new year.”

“She still believes she’s doing the right thing. She’s ready to take on whatever comes her way,” the source adds.

In a bombshell complaint filed with the California Department of Civil Rights on December 20, lawyers for Lively claimed Baldoni, whose production company developed Wayfarer Studios It ends with usHe sexually harassed the actress and then retaliated with a smear campaign against her after she spoke out. (Baldoni’s attorney, Bryan Freedman, called the allegations “false, outrageous and intentionally salacious with the intent to publicly offend” in a Dec. 21 statement.)

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Lively’s filing — a requirement for filing a workplace harassment lawsuit in the state of California — sets the stage for a potentially ugly legal battle and sheds light on allegations of ongoing sexism in Hollywood years after the #MeToo movement.

“I hope my legal action will help lift the curtain on these sinister retaliatory tactics to harm people who speak out about wrongdoing and protect others who may be targeted,” Lively said in a statement to The New York Times.

Currently, the source tells PEOPLE that the actress is “very fortunate to be surrounded by the most loving family and supportive friends,” which includes husband Ryan Reynolds and their four children.

“Ryan does everything he can every day to relieve her stress and support her,” the insider adds of Reynolds, 48.

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As the year draws to a close, Lively’s legal team is currently considering her options and awaiting a decision from the California Department of Civil Rights, which has 60 days to tell her whether they will investigate the matter.

“When they find an obstacle, they often step in and try to negotiate a solution with the employer,” legal expert Gregory Doll, a California attorney not involved in the case, tells PEOPLE in this week’s issue. “If not, they give her what’s called the right to sue, which means she can now go to court and file her lawsuit there.”

If the Simple favor If the actress actually sues and she and Baldoni, 40, don’t come to an agreement beforehand, they would go to court. “The most likely cases that go unresolved are ones like this, where things get very personal between two people,” he notes.

Baldoni could also counterattack – which Doll says is most likely due to the bitter back and forth between the two legal teams. He predicts: “Based on my observations, it is almost certain that he will file a counterclaim.”