The latter. Even if we assume she could prove liability, her damages case was horrible. As
@Grace T. mentioned up thread, her damages for proving liability are $1.
If I had to speculate, I think the fact that she used the Ku Klux Klan Act to pursue her claim pissed a college administrator off; keep in mind that KKK also stands for Kikes, Koons, and Katholics so, this claim could have been offensive to Jews and Catholics as well as Blacks. I think some administrator was willing to spend whatever it cost to get her in a video deposition and depose her for hours to ruin her life forever.
BUT, I think a rich conservative donor (probably an old tobacco farmer) called the Director of Development and threatened not to donate that building if the University didn’t fix the situation in favor of this young lady.
She had no damages. It’s not like she quit soccer, dropped out of school, is in therapy, and working part time at the local Piggly Wiggly because
she developed a meth habit from the trauma on the soccer team an is now incapable of holding down a full time job.