The Grahams had alleged that toxic emissions from the incinerator at Bonnybridge in Stirlingshire, between March 1982 and its closure in October 1984 caused catastrophic illness, including eye defects, in 300 of their pedigree Ayrshire cattle, some of which died or had to be destroyed.
But Mr Justice Forbes, at the end of a 323-page written judgment, said: "I am left in no doubt that Rechem is not responsible in any way for the ill-health that afflicted the Grahams' dairy herd in the 1980s."
The case had lasted 198 days in court, spread over 14 months, and ran up an estimated pounds 3m bill for legal costs bill - half of which falls on the Legal Aid Board.
Permission to have it heard in England was obtained after the Grahams ran into trouble obtaining legal aid in Scotland.
After the judgment, Mr Graham, 61, said he was "fairly disappointed". His solicitor, Anton Bates, said the ruling would be studied to decide the prospects for a successful appeal and to see how it affected other cases pending against Rechem.
He added that the Legal Aid Board, in agreeing to back the Grahams' case, had recognised the public interest in the safe incineration of toxic waste.
Rechem's parent company, Shanks & McEwan, said the ruling "confirms that there was no link between the operations of the former Bonnybridge plant and Mr and Mrs Graham's farming and livestock problems of over a decade ago", which the company argued arose from the couple's poor husbandry.
It said that despite earlier scientific evidence stating there was no basis for the assertions the couple had proceeded with the costly trial. "We are very satisfied that, in the end, the Grahams' allegations and their claim for damages have been proved to be unfounded."Reuse content