Legal Question in Employment Law in Michigan

Can a private sector company of michigan deny an applicant a job based on the sole reason the applicant having a personal relationship with a member of the company's management team? (the position was for human resources) It was asked in the interview if there were any policies against this and applicant was told no in addition, both applicant and interviewer reviewed handbook to confirm that there is not a policy against hiring someone based on their personal relationship with others nor an anti-nepotism policy. However it is a family run company. Currently employed are husbands, wives, children, cousins, etc of other employees and of the owners working side by side. It has been common practice to hire relatives. In fact, interviewer told applicant there would be no issue and relatives hired all the time. It was stated in writing to applicant that was the sole reason job was not offered. In fact applicant was informed that they were a perfect candidate for position. Is this legal?

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