A high court hearing in London last month was told the bed was delivered to Busby's home in August 2013 when she was renovating the property.
Judge Barry Cotter has thrown out the case at the high court - finding the bed as "not defective" and her fall was a "tragic accident".
Miss Busby, of Maidenhead, Berkshire, claimed the bed was "defective" and took legal action against the Berkshire Bed Company.
She told the court she was kneeling in the middle of the bed performing a sex act when she made a decision to move position and "swung her legs" from underneath her, before lying back on the bed with her head towards the bottom end.
"I spun around, I put my hand down and then I felt like I was catapulted off the back", she said, according to CBS News partner network BBC News.
Clair claimed the bed "gave way" at this point and she ended up falling off the bed, landing on her head, and her spine was left seriously injured.
The mom-of-four said she also hit her head on the floor and heard "like a spring in my body snap".
The company denied liability for Busby's injuries and contested the case, insisting the bed was properly assembled.
The judge said Ms Busby had no means of support, other than placing her arm down on the bed, as she attempted to swing her legs around from underneath her in what was "not an easy manoeuvre".
Mr Marshall said he had been badly affected by the accident, which he had initially laughed off.
He added: "Having carefully considered the totality of the evidence I am not satisfied that the difference in level between the two divans played any part in Ms Busby's loss of balance backwards".
"Rather, I am satisfied that this was a simple but tragic fall; she simply overbalanced probably in part because she was sitting on a mattress as opposed to a firm surface, and underestimated the amount of give underneath her body".
'We are sorry that Ms Busby was injured and we wish her and her family well for the future'.