Peter Krause sued the Basic Instinct star in 2008, two years after he sustained a knee injury by falling through latticework and into a neighbour's yard while working on her house.
Stone took to the stand this week (beg11Jul11) to testify there was a fence in the spot where the plaintiff alleged the accident happened.
But a jury ruled the Hollywood beauty was negligent for failing to have a fence sturdy enough to prevent Krause's fall.
Stone's lawyer told reporters outside court, "We're disappointed they did not take her testimony at face value."
Her attorney is considering an appeal, reports Eonline.com.