The problem of the 737 was a rudder reversal problem. i.e. It would deflect to the other side that was commanded by either the pilot or the autopilot. Now I dont know which effect this had on the yaw damper, but in any case as in most or all jetliners it has a hydraulic pressure limiter that restrict pressure to the rudder when travelling higher than a certain speed. This effectively eliminates the possibility of losing a rudder in flight.