A Kentucky-based chemical company cannot prove that its investment broker knew in advance that a securities market would collapse in early 2008, leaving the company with $194 million in investments that couldn't easily be sold, a federal appeals court ruled Thursday.

A three-judge panel from the U.S. 6th Circuit Court of Appeals found that Ashland Inc. couldn't show that New York-based Oppenheimer & Co. lured the company into continuing to buy auction rate securities while hiding knowledge about an impending market implosion.

"At best, the alleged facts suggests that a few Oppenheimer employees were aware of what might happen if the underwriters left the ARS market, a seemingly remote risk, given its past stability," Judge Deborah Cook wrote for the unanimous panel.

The decision upholds a ruling in 2010 by U.S. District Judge Jennifer Coffman rejecting Ashland's claims. Ashland sued Oppenheimer in 2009, accusing the brokerage firm of providing intentionally misleading information about the market for student loan-backed auction rate securities up until the market went under in February 2008.

Auction rate securities are long-term bonds with interest rates periodically reset through recurring auctions, which are commonly held between on a schedule ranging from seven to 35 days. Investors can sell their securities at each auction, provided buyers outnumber sellers. If there are more sellers than buyers, an auction fails, potentially leaving sellers holding the securities.