Ontario Superior Court Justice Andrew Goodman said trial evidence was inadequate to "substantiate the defendants" claim of sexual abuse" in his decision in the case of Patricia and Sarah Vanderkooy of rural Ancaster, Ontario.
The women allege their uncle, Jack Vanderkooy assaulted them while they stayed at his Simcoe, Ontario, farm in the 1980s. Criminal charges were never presented.
The sisters were four and six when the alleged assaults occurred, court records said, adding the allegations tore apart the Vanderkooy family, a large group from the Netherlands and a part of the Christian Reformed Church.
Now in their 30s, the sisters first came forward with the allegations in 2006, the Canadian Broadcasting Corp. reported.
The uncle sued for defamation, and the sisters countersued for sexual battery.
Goodman's decision included a comment the sisters "set out on both (a) covert and public course of action to tarnish an innocent man's reputation ... Jack's reputation in the community may continue to be irreparably harmed."