On Friday, the all-male Iowa Supreme Court unanimously agreed that dentist James Knight was justified when he fired an employee he saw as an "irresistible attraction."
"I'm devastated. There is not an appeal, the state is as far as we can go," said Nelson.
The decision is sparking much controversy, with some employment attorneys calling it a dangerous throwback.
"I wouldn't have been surprised if it was a decision that was written in 1970, maybe by the characters of 'Mad Men,'" said employment attorney Glen Savits.
The 32-year-old married mother of two says she saw her employer as a father-figure and was shocked when Knight admitted that even though she was great at her job, he couldn't be trusted around her.
"After working so many years side by side, I didn't have any idea that that would have crossed his mind," said Nelson.
According to court documents, Knight referenced Nelson's infrequent sex life, saying, "That's like having a Lamborghini in the garage and never driving it."
And when the doctor's wife discovered him sending text messages to his assistant, it was his wife who demanded she be fired. Nelson sued for gender discrimination.
Knight's lawyer told ABC News in a statement, "She (Nelson) was not terminated because of her gender, but to preserve the best interests of his (Knight's) marriage."
Nelson said that's sending the wrong message.
"I think it is sending a message that men can do whatever they want in the workforce," she said.
Nelson's lawyer says she has received a huge outpouring of support, with some people even offering to pay legal costs. But after three years of appealing, there can be no new appeals, because Nelson alleged a violation of state law, not federal law.