The majority opinion in the 5-2 ruling, written by Chief Justice Thomas J. Moyer, said the Ohio law revised did not violate the constitutional rights of injured parties to trial by jury, to a remedy for their injuries or to due process and equal protection.

"The decision in this case affirms the General Assembly's efforts over the last several decades to enact meaningful tort reforms," Moyer wrote.

In one of its challenged provisions, the law caps awards at $250,000 or three times the amount of economic damages, whichever is greater, up to an absolute limit of $350,000. The exception is when a plaintiff suffers permanent disability or loss of a limb or bodily organ system.

In another, the law prohibits awards for punitive damages exceeding two times the amount of the compensatory damages awarded the same defendant.

The court threw out a similar law in 1999 in a decision that prompted businesses to criticize Democratic justices who voted against the legislation. Since then, the court has become an all-Republican bench. In the 1999 vote, two Republicans joined the court's two Democrats in striking down the law, which was revised in 2004.

The U.S. Chamber of Commerce, National Association of Manufacturers and the National Federation of Independent Business Legal Foundation had joined in urging the court to uphold the law.

Groups urging the court to overturn it included the Ohio Academy of Trial Lawyers, the Ohio Conference of the National Association for the Advancement of Colored People and Mothers Against Drunk Driving.

The groups had been ordered in a 2004 civil case to pay 156 million dollars to the family of 17-year-old David Boim, killed in 1996 in an attack. A federal appeals court ruled Friday that the groups' role was not fully established.

It ordered a new trial to examine more closely the links between the organizations and the boy's death.

"The Boims will have to demonstrate an adequate causal link between the death of David Boim and the actions" of the groups, the court ruling said.

"This will require evidence that the conduct of each defendant, be it direct involvement with or support of Hamas's terrorist activities or indirect support of Hamas or its affiliates, helped bring about the terrorist attack that ended David Boim's life."

The groups had been charged with taking part in terrorism by aiding or financing Hamas, a powerful Islamist movement in the Palestinian territories.

"The Boims' theory ... was that in promoting, raising money for, and otherwise working on behalf of Hamas, these defendants had helped to fund, train, and arm the terrorists who had killed their son," the ruling said.

The defendants included the American Muslim Society and the Holy Land Foundation for Relief and Development, which was the biggest Muslim charity in the United States until it was outlawed after the attacks of September 11, 2001.

The foundation also faces separate criminal charges for alleged links with Hamas. It is charged with giving 36 million dollars to committees controlled by the movement from 1992 to 2001.

A leading US Muslim rights group, the Council on American-Islamic Relations (CAIR), welcomed the appeal court's decision Friday.

"This landmark ruling is a strong rejection of the recent disturbing trend of political lawsuits against American Muslims who have committed no crime other than providing humanitarian aid to Palestinians," it said in a statement.

"CAIR deplores the murder of David Boim and hopes that the actual wrong-doers are brought to justice."

Their lawyer, Mark Geragos, says he will refer the case to prosecutors for possible criminal charges against the insurer, Cigna HealthCare.

"All of the doctors there unanimously agreed that she needed and should have that liver transplant. And the only entity, if you will, who said no to that in the middle of that medical decision, was some piece of garbage who decided that making a couple of dollars, or saving them a couple of dollars, was worth more than the 65% chance over six months that she would survive," said Geragos.

"The only reason they approved it is because we had organized a protest in front of Cigna's corporate headquarters& and in the face of public pressure, they did it," he said.

By the time the approval came through Nataline had been on the liver transplant list for two weeks and her condition had deteriorated so badly that it was too late to have the procedure.

"I believe, the corporation knew, powers that be knew, that at that point approving the liver transplant was a 'gimme' because her condition deteriorated to the point where she couldn't receive the liver&she didn't have any chance of either, one, getting a liver or, number two, actually being able to receive it," he says.

Nataline, who was fighting leukemia, developed liver failure after complications from a bone marrow transplant she received from her brother last month.

Despite her already fragile health, Geragos says, "all of the doctors at the University of California Medical Center unanimously agreed that she needed and should have that liver transplant."

More than 6,000 liver transplants are performed in the United States every year, making it one of the most common organ transplants, according to the United Network for Organ Sharing.

The lawyers' payments, which when proposed had attracted criticism from some institutional investors as being too hefty, will be drawn from the settlement fund.

"In summary, I find that the settlement is fair, reasonable and adequate," U.S. District Judge Paul Barbadoro wrote in the ruling.

Tyco agreed in May to pay $2.975 billion to settle several long-running class-action lawsuits. Another defendant, former Tyco auditor PricewaterhouseCoopers LLP, said in July it would pay $225 million to resolve the litigation.

Kozlowski and former Tyco finance chief Mark Swartz were found guilty in June 2005 of stealing millions from the conglomerate, a case that became infamous amid revelations that Kozlowski had used company funds to pay for a $15,000 umbrella stand and a $6,000 shower curtain.

Kozlowski and Swartz are now serving sentences of up to 25 years apiece in New York state prison.

Plaintiffs in the shareholder lawsuit contended that from December 1999 through June 2002, Tyco and others misrepresented the value of acquisitions and misled investors about Tyco's financial health. The settlements were reached before the case ever went to trial. 

Phillip Bennett, the former chief executive of Refco, and others have been indicted in connection with the Refco collapse.

"Acting hand-in-hand with Bennett, Collins made affirmative misrepresentations, material omissions, and told deceptive half-truths, all to assist Bennett's scheme to steal more than $2.4 billion from potential investors," the indictment said.

Lawyers are rarely charged criminally in connection with a client's alleged fraud. In the collapse of Enron Corp., no outside lawyers were charged. "There tends to be gray in legal transactions, but to show intent in a white collar prosecution, it needs to be black and white," says Andrew Weissmann, the former head of the Department of Justice's Enron Task Force and now a partner at Jenner & Block LLP. "It's difficult to develop that kind of evidence against lawyers."

The Securities and Exchange Commission also filed a civil complaint Tuesday against Mr. Collins, alleging that he aided and abetted securities fraud at Refco.

Mr. Collins, who has been the head of Mayer Brown's derivatives group, is now on leave from the firm while the charges are pending, the firm said Tuesday. "Mayer Brown has cooperated fully with authorities investigating activities related to the collapse of Refco," the firm said in a statement. "Our review of the evidence available to us shows that the firm acted in a professional, competent and ethical manner in its work on behalf of Refco."

Mr. Collins's lawyer, William Schwartz, said his client intended to fight the charges and called him "an innocent victim of the Refco fraud. This indictment should send a chill down the spine of every transactional lawyer who believes he or she is representing an honest client."

Michael Garcia, the U.S. Attorney for the Southern District of New York, took a different view, saying it is "not a crime to have a client who commits a crime. No lawyer will be prosecuted unless that lawyer knows about the client's fraud and agrees to join in it understanding its unlawful nature."

The charges are a blow to a law firm that has weathered several of late. In July, buyout firm Thomas H. Lee Partners LP, which purchased a stake in Refco in 2004, sued Mayer Brown for allegedly failing to inform Lee about the bogus loan transactions. Also this year, an independent examiner filed a report in Refco's bankruptcy, concluding that there was significant evidence that the law firm "knew or should have known" the loans were fraudulent.

Beyond Refco, the law firm has struggled with recent defections by high-profile partners, and it suffered negative publicity this year when it fired or demoted 45 partners in an effort to boost its profitability.

U.S. District Court Judge Henry Kennedy, who in 2005 had ordered the government to preserve information on prisoner mistreatment at the U.S. naval base at Guantanamo Bay, Cuba, scheduled a court hearing on the tapes for Friday, overriding government objections.

Lawyers for a group of Guantanamo Bay inmates contesting their detention had requested the hearing to learn whether the government had complied with the preservation order. They cited reports that information obtained from the interrogations implicated five unnamed Guantanamo detainees.

"We hope to establish a procedure to review the government's handling of evidence in our case ... and generally to require an accounting from a government that has admitted that it destroyed evidence," said David Remes, an attorney for the group of inmates.

He declined to comment on whether he believed any of his clients were implicated during the interrogations.

The CIA on December 6 disclosed that it had destroyed hundreds of hours of interrogation tapes, prompting an outcry from congressional Democrats and human rights activists. The sessions recorded on the tapes were believed to have included a form of simulated drowning known as waterboarding, which has been condemned internationally as torture.

The CIA said it destroyed the tapes lawfully and did so out of concern for the safety of agents involved if the recordings were ever made public. The White House has repeatedly denied the United States tortures terrorism suspects.

The Justice Department declined to comment on the judge's hearing order but the department last week urged Kennedy not to investigate the videotapes.