Gremio appeal over Copa do Brasil ban fails
Luiz Felipe Scolari's men were banned from this year's tournament after their supporters aimed racial slurs at Santos goalkeeper Aranha earlier this month.
Gremio suffered a 2-0 loss in the round of 16 first leg, before a Brazilian sports tribunal unanimously voted for Gremio's exclusion.
While the verdict was partially overturned, a points deduction has effectively ended Gremio's involvement in the competition.
Santos will now meet Botafogo in the quarter-finals.
Gremio, who were also fined 54,000 Brazilian real, are four-time winners of the Copa do Brasil, but have not tasted glory since 2001.