Barclay, who with his twin brother Frederick owns The Daily Telegraph and the Ritz Hotel, had filed suit against Hedi Tillette de Clermont-Tonnerre over a play that won critical reviews in Paris earlier this year.
Entitled Les Deux Freres et les Lions (The Two Brothers and the Lions), it does not mention the brothers directly, but has clear parallels with the pair who were born into a modest Scottish family and went on to build a vast property and media empire.
Barclay had sought €100,000 euros in damages for libel and violation of privacy and had sought to have the work – which played at a small Paris theatre until March 31 – banned.
“In the text, there are no facts revealed that were unknown, egregious, intimate or even imaginary and pejorative which are likely to constitute a particularly serious intrusion into the (plaintiff's) life,” the judges wrote.
The court ordered the 85-year-old to pay €6,000 in moral damages to the writer, as well as €5,000 to each of the three theatre companies involved in producing the play for infringing their right to show the work.
He was also ordered to pay €35,000 in legal costs.
“This is a remarkable ruling,” Clermont-Tonnerre's lawyer Olivier Morice told AFP.
“In severely penalising David Barclay to pay damages and interest, the court has recalled the major principles for safeguarding creative freedom,” he said.
But Barclay's lawyer Christophe Bigot said the British tycoon, who with his brother has an estimated fortune of £8 billion (€9.3 billion), would likely appeal the ruling.
In its publicity blurb, the 150-seat Theatre de Poche describes the play being about: “The irresistible rise of two Scottish immigrants.
“This tale is about twins from a poor background who came to have one of the biggest fortunes of Great Britain by the end of the 20th century.”