The suit accused Google of violating free speech, unfair competition, defamation, libel and skewing search results in favour of companies that compensate Google financially.
Judge Jeremy Fogel, of San José, California, also granted a motion by Google to sanction KinderStart and one of its lawyers.
Google can now seek reasonable compensation for attorney fees after the judge ruled that KinderStart lawyer Gregory Yu filed claims that were factually baseless, and did not perform an adequate investigation before filing the lawsuit.
Judge Fogel wrote in his ruling: "Yu's purported evidence is either double hearsay or hearsay speculation as to the 'mysterious' causes of improvement in a website's position in Google's search results.
"Yu provides no evidence that would support KinderStart's broad attacks on the objectivity of Google's search results."
KinderStart's suit also alleged that Google is in the habit of removing websites from search results for "political and religious reasons", despite the fact that KinderStart did not appear to suffer any such discrimination by Google.
"While Yu has brought a novel challenge to a major corporation, it is apparent that to some extent he has overreached in doing so," Judge Fogel wrote.
"Yu had a professional responsibility to refrain from filing such allegations if he did not have appropriate supporting evidence."
Google's litigation counsel Hilary Ware said: "We always felt these claims were unjustified because courts have consistently rejected complaints over search engine rankings, so we are pleased that Judge Fogel promptly dismissed this case."
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