Athan Montgomery was born with severe brain damage in 1997 after physician Gregory Drezga made a failed attempt to deliver him with forceps.

A judge found Drezga negligent, and a jury awarded the boy $22,735 for money already spent on his care and $1 million for future care expenses. They also awarded $1,250,000 in so-called "non-economic" damages for pain, suffering and diminished quality of life.

A judge reduced the non-economic award to $250,000 in accordance with Utah state law, and the appeal followed.

Similar medical malpractice damage cap laws have been recently enacted in states including Nevada and Texas. Such legislation is expected to be on the federal agenda during President Bush's second term in office.

The boy's attorneys had asked the state high court to find Utah's cap unconstitutional on several fronts, including violating rights to due process and a jury trial, and the separation of powers between the legislative and judicial branches.

In a 3-2 decision Friday, the justices recounted lawmakers' reasoning that the cap would reduce health care costs and increase the availability of medical malpractice insurance.

"This cap severely injures young Athan, who will live a life greatly diminished by Dr. Drezga's negligence," wrote Associate Chief Justice Michael D. Wilkins for the court. "But that is a policy choice made by the legislative branch, and we cannot say that it is unconstitutional."

Chief Justice Christine M. Durham and Justice Ronald E. Nehring dissented, saying they believe the cap is unconstitutional. A spirited opinion penned by Durham pointed to an "arbitrary method by which the statute distributes the cost of its solution to the so-called malpractice crisis."

Durham noted the most recent statistics from the National Practitioner Data Bank show Utah ranking 50th among all states in the median size of verdicts awarded in malpractice cases.

That, she said, "undermines the notion that jury verdicts have anything to do with premiums in this state . . . While we owe deference to legislative judgments on policy questions generally, we do not grant immunity to constitutional review on the basis of legislative assertions of 'fact' that have no demonstrated basis in reality."

Durham also wrote the cap leaves the most seriously harmed plaintiffs "likely to receive the smallest fraction of his or her actual damages, while the less injured are likely to receive much higher, or even total, compensation for the injuries they suffer."

The Attorney General of Utah, the Utah Medical Association, the Utah Hospitals and Health Systems Association and Intermountain Health Care had filed friend of the court briefs, asking the justices to uphold the law.