A federal appeals court has upheld most counts against two Chinese nationals convicted of breaking U.S. laws concerning overseas shipment of weapons-grade technologies. But it reversed two counts each for exporting items restricted under the U.S. Munitions List, and remanded the cases for resentencing on all counts.

On Tuesday in a joint ruling, the U.S. Court of Appeals for the First Circuit upheld 15 counts and vacated two against Zhen Wu and upheld 11 and vacated two against Yufeng Wei. The court overturned the two counts for each defendant due to faulty jury instructions. The U.S. Munitions List covers categories of "defense articles" that require export licenses.

The appeals court vacated Wu’s 36-month sentence and Wei’s 97-month sentence, remanding both cases for resentencing.

From 1996 until 2008, Wu and Wei — who were married between 1988 and 1999 — shipped tens of millions of dollars worth of electronic components from the United States to China.

In 1996, Wu opened an electronic-parts broker, Chitron Electronics Co. Ltd., in China and a Massachusetts purchasing office for the company. In 1998, the Massachusetts office became Chitron Electronics Inc., and Wu continued to run it.

The U.S. entity bought parts from U.S. vendors and shipped them to Chitron’s customers in China. The company initially shipped parts to freight forwarders in Hong Kong and then to its own Hong Kong branch office starting in 2005.

The pair falsely indicated on various documents that the parts’ final destination was Hong Kong, or they prompted employees to do so.

After a 23-day jury trial, the pair were convicted on counts including exporting without a license, conspiracy and making false export declarations, in addition to the Munitions List counts. Chief Judge Patti Saris of the District of Massachusetts sentenced both defendants in January 2011.

Chief Judge Sandra Lynch wrote the opinion in U.S. v. Wu and U.S. v. Wei, joined by Senior Judge Bruce Selya and retired U.S. Supreme Court Justice David Souter, who heard the case by designation.

The jury instruction issue concerned the jury’s role in deciding whether phase shifters, small complex microchips that the two defendants exported, were on the Munitions List at the relevant time.

Lynch wrote, "the proper question for the jury was whether Wu and Wei’s conduct violated the relevant regulations as those regulations existed at the time the conduct occurred." She observed that "no State Department designation had been made at the time that the defendants engaged in the charged conduct."

She further explained, "Here, we only go so far as to say that under the existing statutory and regulatory scheme, the question of whether phase shifters were items controlled by Category XI(c) of the Munitions List was a question for the jury — not a question that could be decided ex post by the State Department as a matter of law."

Lynch detailed the strong evidence supporting the other convictions, including Wei’s conviction for making false statements on an immigration application.

She also upheld conspiracy convictions for each, noting that "whether the phase shifters that Wu and Wei exported to China were actually on the Munitions List was not essential to the conspiracy charge."

With regard to their sentences, Lynch wrote, "We have said that ‘[w]hen a defendant successfully challenges one of several interdependent sentences, the proper course often is to remand for resentencing on the other (nonvacated) counts.’… We believe that such a course is appropriate here."

Wu’s lawyer, Michael Schneider of Boston’s Salsberg & Schneider, said the ruling is an important civil liberties victory for people charged with regulatory crimes.

"It is now clear that even in cases with a purported national-security dimension, an individual cannot be sent to prison based on an agency bureaucrat’s after-the-fact determination that the individual’s conduct violated a regulation," he said.

In an emailed statement, Wei’s lawyer, Nathan Dershowitz, a partner at New York’s Dershowitz Eiger & Adelson, stated, "We are pleased by the Court’s reversal of the principal and most serious charges which related to the shipment of items which were purportedly on the U.S. Munitions list. We were disappointed that the Court affirmed the other counts and extremely surprised by the Court’s rationale on some of these issues."

The Justice Department did not respond to requests for comment. Stephan Oestreicher Jr., an attorney in the Justice Department’s Criminal Division appellate section, argued.