The Victorian ALP has failed in its dramatic legal bid to close down the anti-branch stacking campaign of its leading reform champion.

Friday's Supreme Court outcome allows veteran party activist Eric Dearricott continued access to the party's membership records, allowing him to pursue his anti-branch-stacking campaign.

Former premier John Cain outside the Melbourne Supreme Court on Friday. Credit:Jason South

The win for Mr Dearricott was hailed as a victory for party democracy and transparency by former premier John Cain, who was present in the Supreme Court.

"He's a whistleblower and whistleblowers need protection," Mr Cain said. "The party shouldn't be trying to shut him up."