Christopher Kapessa was allegedly pushed into the River Cynon near Fernhill, Rhondda Cynon Taff, by a 14-year-old boy in July 2019, a High Court hearing has been told.
The Crown Prosecution Service (CPS) decided that a prosecution was not in the public interest.
Christopher’s mother, Alina Joseph, who is from the Cynon Valley, took High Court action against the Director of Public Prosecutions Max Hill, who heads the CPS.
Two judges ruled against her on Monday following hearings in the case last week.
Lord Justice Popplewell and Mr Justice Dove had considered argument at a hearing in London earlier this month.
Barrister Michael Mansfield QC, who led Ms Joseph’s legal team, argued the decision not to prosecute the “suspect”, who is now 17, was “unreasonable or irrational”.
Lawyers representing the CPS had argued that Ms Joseph’s challenge should be dismissed.
In July 2020 the CPS said that although there was evidence to support a prosecution for manslaughter, it had decided it was not in the public interest to do so for what it described as a “foolish prank”.
At a judicial review hearing on Thursday Mr Mansfield said prosecutors had misunderstood the culpability of the teenager and given his youth “undue weight”.
He said the decision not to prosecute went against the CPS’s own guidance with respect to homicide cases, which states that “subject to sufficiency of evidence, a prosecution is almost certainly required”.