As revealed by The Australian, Ms Miller sued Ms O'Brien last year after her former employee circulated an email and fax accusing her former boss of "misusing government entitlements", bullying and intimidation.
The politician has denied all of the claims.
Ms O'Brien alleged that her stint working in Ms Miller's parliamentary secretary office until 2006 left her suffering from severe depression and seeking the services of a psychiatrist.
Ms Miller also slapped a lawsuit on Ms O'Brien's husband, who she accused of being involved in the distribution of his wife's letter, in the run-up to Labor preselection for Bundamba in late 2008.
He denied having anything to do with the publication of the letter and applied to the Supreme Court to have the case against him quashed. Ms Miller eventually consented to dropping the case against Mr O'Brien.
And in an order handed down this month, Justice Lyons said Ms Miller should not have continued with the lawsuit once Mr O'Brien had issued his denial and Ms O'Brien had admitted she had been solely responsible.
"I consider that (Ms Miller) has persisted in a hopeless case against (Mr O'Brien), and that (Ms Miller) should be ordered to pay (Mr O'Brien's) costs of this application and of the action on an indemnity basis to be assessed," Justice Lyons said.
Ms Miller is also suing for defamation Kerry Silver, who challenged her for preselection for Bundamba in 2008, for allegedly repeating Ms O'Brien's claims.
Ms Silver has denied the accusations and applied to have the case against her dismissed, but Justice Lyons rejected her application.
Mr O'Brien told The Australian that Ms Miller's lawsuit against him was frivolous.
"I've got my costs from September last year until now, for a case that could not be won by her," he said.
"Why was it carried on? It was frivolous."
