WASHINGTON, Feb 22 (Reuters Legal) - The U.S. Supreme Court ruled that federal law shields vaccine makers from product-liability lawsuits in state court seeking damages for a child's injuries or death from a vaccine's side effects.

The high court on Tuesday ruled for Wyeth, which is now owned by Pfizer Inc, in a lawsuit brought by the parents of Hannah Bruesewitz, who suffered seizures as an infant after her third dose of a diphtheria-tetanus-pertussis (DTP) vaccine in 1992.

Pfizer and other vaccine makers argued that a Supreme Court ruling for the plaintiffs could open the door to a flood of lawsuits -- many by families who believe vaccines cause autism -- and threaten the supply of childhood vaccines.

At issue was the National Childhood Vaccine Injury Act of 1986, a law adopted by Congress that created an administrative court to hear vaccine-related claims. The special court, which provides an alternate form of compensation to plaintiffs, was created to ensure a stable vaccine supply by shielding manufacturers from liability.

The so-called vaccine court has awarded more than $1.8 billion for vaccine injury claims in nearly 2,500 cases since 1989. It is funded by a tax on vaccines.

In the Hannah Bruesewitz case from Pennsylvania, Bruesewitz's parents claimed that her seizure disorder and serious developmental delay stemmed from toxins in the vaccine's design.

They said a safer alternative had been available but was not used. The DTP vaccine was taken off the market in 1998 and replaced.

Wyeth has denied its vaccine caused the injuries.

After the couple's claims were rejected under the federal compensation process, they filed a lawsuit in state court. But a federal judge and then a federal appeals court based in Philadelphia ruled the 1986 federal law barred such lawsuits.

The Supreme Court, in a majority opinion by Justice Antonin Scalia, upheld that decision and ruled that the wording of the vaccine liability shield suggested that legislators intended it to protect manufacturers from all tort claims based on defective designs.

"Vaccine manufacturers fund from their sales an informal, efficient compensation program for vaccine injuries; in exchange they avoid costly tort litigation and the occasional disproportionate jury verdict. Congress enacted this deal to coax manufacturers back into the vaccine market," Scalia said.

In dissent, Justices Sonia Sotomayor and Ruth Bader Ginsburg argued that the majority's decision to bar all claims upset a policy balance in which Congress intended on the one hand to encourage vaccination protection and, on the other, to compensate children injured by vaccines.

Justice Elena Kagan took no part in the decision.

The ruling accepted the Obama administration's position.

O. Marion Burton, president of the American Academy of Pediatrics, which represents 60,000 pediatricians, applauded the ruling.

"Today, the U.S. Supreme Court affirmed what pediatricians have been advocating for decades," Dr. Burton said. "Vaccines save lives."

The case is: Bruesewitz v. Wyeth LLC, Supreme Court of the United States, No. 09-152.

For the parents: David Frederick of Kellogg, Huber, Hansen, Todd, Evans & Figel; Collyn Peddie

For the vaccine makers: Kathleen Sullivan of Quinn Emanuel Urquhart & Sullivan; Daniel Thomasch of Orrick Herrington & Sutcliffe.

(Reporting by James Vicini of Reuters; Additional reporting by Jeff Roberts of Reuters Legal)