One of the five claimants, Ian Lawless, who spent eight years in jail for a murder he did not commit, won his case and was granted permission to have his claim reconsidered.
Nicholas Baird, the solicitor for George, said he and his family were "terribly disappointed" at the finding and would continue their fight for redress from the Government.
George, who has been diagnosed with Asperger's syndrome, is seeking damages for lost earnings and wrongful imprisonment following his conviction of the murder in 1999 of Dando, who was shot dead on the doorstep of her home in Fulham, west London. The Court of Appeal overturned the conviction after doubt was cast on crucial evidence of a "firearms discharge" particle found in a pocket of a coat George wore. When he was acquitted in a retrial, prosecutors said he had "the right to be regarded as innocent".
The test case followed a landmark Supreme Court decision in 2011 which found the "mere quashing" of a conviction could not be an automatic "trigger for compensation".
The ruling by nine judges set a new test for a miscarriage of justice that required damages should only be paid if a person could prove there were no circumstances that could have led to a jury conviction.
In a judgment that raises the question of a distinction in the judicial system between acquittal and a declaration of innocence, Lord Justice Beatson and Mr Justice Irwin said: "There was indeed a case upon which a reasonable jury, properly directed, could have convicted the claimant of murder."
Legal experts said it was about "shutting down" the flow of compensation.
- Independent
