A little over a year ago, a friend and I visited Conrad Black at the federal prison at Coleman, Fla. His former company, Hollinger International Inc., was one of the early investors in the newspaper I last edited, The New York Sun, and he had been one of its founding directors. As we passed around vending machine snacks, Conrad talked, as he usually does, brilliantly—about statecraft, politics and history.

We spent several cheerful hours together, but I confess that I was shaken by the visit. It was not only because of the grim reality of prison; even Coleman's low-security unit is no country club. It was also because I glimpsed, if only fleetingly, that Conrad was tempted to give in to bitterness toward the America of which he had been one of the greatest defenders of his generation.

Yet in the months since then, an inspiring thing happened. In a display of character that I perceive as heroic, he shook off the temptation of cynicism and, in the face of predictions that it was a one-in-a-million gamble, pressed his appeal.

One can call it his finest hour. Now the Supreme Court—in a unanimous decision announced Thursday—has ordered the lower courts to take a new look at his case. It sets up the final phase of a drama that is all the more gripping because it affects how the government can go after other captains of finance and industry, so many of whom are under attack in our courts and politics today.

Before his case came before the court, Black had been accused by the caretakers of the newspaper empire he built of bilking it of more than $400 million. The government charged him with stealing $60 million. At trial, the government was humiliated on nearly all counts. The jury vindicated Conrad completely on nine of the 13 counts, clearing him of the big ones and also the headline-making accusations. Not guilty on most of the noncompete agreements. Not guilty of spending on his wife's birthday party. Not guilty on the trip to the South Pacific. Not guilty of tax evasion. Not guilty of racketeering. In other words, as I told the staff of the Sun at the time, Black was cleared of the charge that he had run Hollinger International Inc. as a "kleptocracy."

The jury, however, did convict him on four counts that are felonies. They included one count of obstruction of justice, for removing boxes of papers and personal effects from a Hollinger office from which he'd been evicted. They contained nothing the government had not reviewed and were, in any event, handed over promptly to the prosecutors. And he was convicted of three counts of mail fraud. He drew a sentence of six and a half years. He tried to have the sentence stayed while he pressed his appeal, but the government fought against it and he has been in prison for more than two years.

The Supreme Court is unanimous in finding that there are errors in the case. They are thrown into sharp relief by the fact that neither Conrad Black, nor the district judge who conducted the trial, nor the prosecutors, nor the defense lawyers, nor the appeals judges, nor the Supreme Court now knows what he's been jailed for. This is because the government pursued what the Supreme Court called two alternative mail fraud theories and the jury didn't have to say on which one it relied.

Imagine being told you are going to jail for either A or B and then discovering that B is not a crime.

One theory on which the government went after Black and his co-defendants, as the Supreme Court summarized it, was that they "stole millions from Hollinger by fraudulently paying themselves bogus noncompetition fees." The other theory reckoned that, as the court put it, by failing to disclose those fees, they had deprived Hollinger of their "honest services"—a phrase used in a relatively recent federal law that makes it a crime to deprive an employer of one's honest services but doesn't get into details about what that means.

Before the charges went to the jury, the prosecutors proposed, as the Supreme Court sketched it, having the jury not issue a general verdict that said merely guilty or not guilty but using forms that would be submitted to them beforehand that would "reveal, in the event that the jury voted to convict on a mail fraud count, the particular theory or theories accounting for the verdict." Black's legal team, the court noted, "resisted." The team no doubt feared the forms would amount to giving the jury a road map on how to convict.

Then, in what can only be called a desperate move, the government turned around and tried to argue that, in objecting to giving special verdict forms to the jury, Black had forfeited his right to appeal. The Court of Appeals for the Seventh Circuit sustained that view. The Supreme Court ruled that the government and the appeals court were wrong to deny him the right to appeal.

The Supreme Court also ruled that one of the two alternative theories the court and prosecutors put to the jury used an improper construction of the "honest services" component of mail fraud. The court identified the error in the case of Jeffrey Skilling of Enron, limiting the use of the law to cases of involving bribery and kickbacks, which even the prosecutor concedes were never involved in Black's case.

Justices Antonin Scalia and Clarence Thomas, in a brief concurrence, wrote that they would have tossed out the entire honest services statute as being "unconstitutionally vague." Justice Ruth Bader Ginsburg, in any event, wrote for the whole court that their decision in Skilling v. U.S. "makes it plain that honest services instructions in this case were indeed incorrect."

Now Conrad Black's appeals lawyer, Miguel Estrada, will go back to judges who turned Black down the first time. He will ask for bail while preparations are underway for the rethinking of the case that the Supreme Court has ordered. He will ask the court to vacate the fraud convictions, on which the appeals court judges—Richard Posner, Michael Kanne and Diane Sykes—originally took an extremely hard line.

Mr. Estrada will no doubt ask the court to vacate the related conviction for obstruction, which wasn't addressed by the Supreme Court but could have been affected by the error on honest services. The prosecutor, Eric Sussman, now in private practice, predicted on the Toronto Globe and Mail Web site Thursday that there was only a 5% chance the judges in the case would reduce Black's prison time.

Well, the prosecutor has been proved wrong about nearly all of the lurid charges and bold predictions he made at the start of the case. When the appellate judges look up, they cannot fail to note that not a single Supreme Court justice credited the prosecutors' reasoning—or theirs—in a case that has already destroyed one of the greatest newspaper empires of all time and wiped out hundreds of millions of dollars in shareholder value. I hope that when I next visit Conrad Black, he will be a free man. Even if he's not, his courage in standing for his own honor has helped spare others a similar fate.

Mr. Lipsky, founding editor of the New York Sun, is the author of "The Citizen's Constitution: An Annotated Guide" (Basic Books, 2009).