U.S. District Judge Manuel Real said the case is out of his jurisdiction and should be filed in Florida state court.
Plaintiff Fred Goldman, father of one of the people for whose deaths Simpson was found liable, lives in Arizona, and Simpson lives in Florida. Real's jurisdiction is the federal Central District of California.
"They got kicked out to the curb," Simpson attorney Yale Galanter said after the hearing.
Jonathan Polak, an attorney for the Goldman family, said the family had not decided whether to appeal Real's decision or take the lawsuit to Florida.
Fred Goldman alleged in the lawsuit that Simpson used a shell company to conceal an advance he received for a book-and-TV deal to avoid paying a wrongful death judgment.
Goldman had sought a court order freezing the money or turning it over to the family. The book, which was spiked in November by the publisher, contains a chapter in which Simpson gives a hypothetical account of how he would have killed ex-wife Nicole Simpson Brown and Goldman.
Ronald Goldman's sister, Kim Goldman, 35, of Los Angeles, said she would not abandon fighting Simpson in court.
"We've been encouraged to let it go, and to let our anger subside. I find that ridiculous and offensive," she said. "I'm gonna squeeze him until he explodes."
Simpson received $895,000 in the deal but spent it on items such as tax payments, his mortgage and tuition for his children's schooling, said one of his attorneys, Ron Slates.
"It's gone," he said.
Simpson was acquitted in 1995 of murder in the June 12, 1994, slayings of Goldman and Simpson's ex-wife in Los Angeles.
Two years later, a state jury ruled in a lawsuit that Simpson was liable for their deaths and ordered him to pay $33.5 million, which with interest has grown to about $40 million.
The former football star's Heisman Trophy was sold to pay a portion of the judgment, but the plaintiffs have been unable to recover any substantial cash.