Smith, a model and television personality, died of a drug overdose in 2007 shortly after giving birth to Dannielynn, the daughter of her former beau Larry Birkhead.
Before she died, Smith had spent more than a decade battling Marshall's family for a cut of the fortune he left when he died 14 months after marrying Smith.
Smith was 26 and Marshall was 89 at the time they wed in 1994. She had always maintained he promised her some of his money even though he did not specifically say so in his will.
However, USA Today said the 9th U.S. Circuit Court of Appeals in San Francisco ruled Friday Smith's estate should not receive any of the money Marshall left behind.