FaizSiddiqui had sued the varsity after 17 years, in last November, claiming that he received "inadequate" teaching on his specialist course on Indian imperial history, which led to him getting a 2:1 back in 2000 and compromised his earnings in the job market as a high-flying lawyer.
But a judge dismissed the case this week, saying the 39- year-old may have "simply coasted" during his course and offered him "sympathy and understanding".
Lawyers for Siddiqui, who studied modern history at Brasenose College,had argued that the second-class degree meant a loss of earnings in his future career as a lawyer.
They had also claimed that missing out on a first-class degree had led to a rejection from the Harvard Law School and affected his mental health and career.
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While the judge accepted the claimant had suffered severe depression, he felt it could not be attributed to his degree result.
In one case, his employers had complained of "poor behaviour, rudeness and lack of IT skills".
"There is nothing at any point to suggest that what is said to have been his preoccupation with his Oxford degree result played any part in these false starts," the judge noted.
He said that it was possible that Siddiqui simply got over-anxious during the examination process.
"However, anxiety producing a less than otherwise merited result is not an unfamiliar examination scenario generally nor, in his case, is it the fault or responsibility of his teachers," Justice Foskett said.
Oxford University had accepted there were fewer teaching staff available in the autumn term in 1999 due to staff being granted leave of absence but denied the teaching standards were "inadequate".
The judge accepted that view and said students must not use the courts to settle grievances about their university education.
There may be "some rare cases" where compensation is due for the inadequacy of the tuition, "but it is hardly the ideal way of achieving redress," the judge warned.
The university had applied to the High Court to strike out the claim for damages but a judge had ruled last year that Oxford University had a case to answer and that the arguments should be heard at a trial, which concluded in last November.