The first jury ever to hear a class-action lawsuit filed over silicone breast implants found yesterday that Dow Chemical Co. did not properly test the material for safety in humans and covered up problems with the devices.

After 17 hours of deliberations over two days, the jurors answered yes to all seven questions posed in a case involving 1,800 Louisiana women claiming a range of ailments of the immune system resulting in pain and fatigue.

The decision marks the end of the first phase of a four-phase trial in state court. In the second phase, which starts next month, jurors will hear testimony about whether the implants caused the health problems suffered by a subset of eight women. That second phase may take more than four months.

If no link between implants and disease is proved, the company will pay no damages. If the jury does find that the implants caused illness, however, that decision would clear the way for hearings for each of the 1,800 plaintiffs to assess the cost of the damage.

"This is a major victory for all silicone-implanted women," said Dawn Barrios, part of the team of attorneys suing on behalf of the women. Barrios said that because the silicone involved in this case was used by other major implant makers, the decision would affect related class-action lawsuits that are scheduled to go forward next year.

But Dow Chemical reacted angrily to the decision, arguing that the company has never designed, tested or manufactured silicone breast implants, and was never in a position to make assertions about the devices' safety. The implants at the center of the Louisiana suit were manufactured by Dow Corning, a company formed by Dow Chemical and Corning decades ago and half owned by each. "The company had no way of knowing which silicone compounds were to be used in medical implants," said John Musser, director of public affairs for Dow Chemical.

Attorneys for implant recipients, however, argued that Dow Chemical's scientists had conducted extensive studies on silicone and that Dow Corning later relied on the tests when it decided to make implants.

Dow Corning, the company that made the implants, is currently seeking protection in bankruptcy court; the ultimate disposition of the Chapter 11 bankruptcy action will determine the payout of all legal claims against that company. Because of the ongoing bankruptcy proceeding, the implant maker was left out of the decision by the court yesterday.

"This verdict has no impact on Dow Corning," said company official Barie Carmichael. "Our case will be resolved through Chapter 11."

Dow Corning's bankruptcy filing came after a 1994 global settlement totaling $4.25 billion between implant makers and women suing the companies failed to attract enough registrants to provide the company with financial predictability. Dow Corning has subsequently argued that it should not have to pay claims for systemic illness without strong scientific proof that implants cause such well-known immune system diseases as lupus and rheumatoid arthritis. The four other major companies that have manufactured implants formed a revised settlement program. The court handling that settlement has already sent out more than 70,000 checks to implant recipients.

Thousands of implant lawsuits have been filed around the country since 1992, when the Food and Drug Administration imposed a temporary moratorium on use of the devices. Access to silicone breast implants has been limited since that moratorium, though implants filled with a saltwater solution are still available.

The lawsuits have unearthed internal corporate memoranda, especially from Dow Corning, that show company scientists debating the dependability of the devices and the possible health risks of silicone. Although the company has argued that the memos reflect healthy scientific debate and that all discussions were resolved with internal findings of safety, the documents have proved damaging in many cases.

Since the FDA's moratorium, a number of studies have found no strong link between implants and classic autoimmune disease. Those studies have not, however, ruled out a small link that might affect thousands of women and would not be picked up in the studies; similarly, the studies have not ruled out a link to atypical autoimmune disease.

The new studies have had an effect in court, with a number of recent cases favoring manufacturers. An Aug. 14 decision in Houston rejected claims by Ossi Goldshtin that her medical problems were caused by silicone from devices made by former implant maker Bristol-Myers Squibb Co. A week before, a California jury found in favor of a subsidiary of Bristol-Myers Squibb as well. Anti-implant activists' groups point out, however, that implant makers have also settled thousands of cases rather than take them to court.

Musser of Dow Chemical said that the recent studies will help the company in the second phase, because the research tends to support the company's contention that the implants do not cause disease. "We are confident that the jury will decide in our favor."

The Louisiana case has taken many unusual turns. On July 16, Judge Yada McGee declared a mistrial after finding that plaintiffs' attorneys had inappropriately attempted to charm the jurors through eye contact and body language. McGee reversed herself the next day after polling the jury, and imposed $2,500 fines on two attorneys. "I have not been able to sleep," McGee said in court. "I have wept for these women, for these attorneys. . . . With one stroke of the pen I devastated the lives of these people," McGee said. "Today was good for us because it proves that we're not crazy," said Peggy Musmeci, a Metairie, La., implant recipient who attended much of the trial. "They put something out there without testing it thoroughly to see if it was safe for human consumption. They lost all seven questions. That makes me feel good." CAPTION: Peggy Musmeci, left, an implant recipient, reacts to the verdict. CAPTION: Plaintiff Nikki Kaufman hugs a friend after hearing the verdict. In the first phase of a four-phase trial, the jury found that Dow Chemical did not properly test the material used in the breast implants and covered up problems with the devices.