Judge John Foster on Monday threw out the suit at Warren Consolidated Schools' request.
Jamey Petree sued in 2010. His daughter was a student at Margaret Black Elementary School in Sterling Heights that year when the passages were read.
The lawsuit claimed racial bias and harassment. The teacher read excerpts from the award-winning book "From Slave Ship to Freedom Road," which contains racial epithets and racist characterizations.
Foster said the book didn't violate the Elliott-Larsen Civil Rights Act because it supplemented the approved fifth-grade social studies textbook and curriculum.
Attorney Scott Combs, who represents the family, said he'll appeal.