I am so sorry that he made this choice. It was immature, vindictive, and obviously not in the best interest of his daughter. He is not, sadly, a good father. That said, you did not fail your daughter in any way. If you had kept her from him, that would have not gone well for you or for her. She needed to learn who he was and try to see if she could have a relationship with him - even though it had a painful outcome and she will need to work through her feelings about what happened, it allows her to move forward with her life with the knowledge of who he is. That is the healthiest path. That it came from him, not you.

Is it possible for you to appeal their decision?