The case fell apart because the evidence that the FBI had was not about a pocket heater. "In a sworn affidavit, one engineer, Ward S. Ruby, said he was uniquely qualified to identify a pocket heater. 'I am very familiar with this device, as I was one of the co-inventors,' he said." Apparently nobody in the FBI or DOJ bothered to verify that the information referred to the device in question: "Dr. Xi's lawyer, Peter Zeidenberg, said that despite the complexity, it appeared that the government never consulted with experts before taking the case to a grand jury. As a result, prosecutors misconstrued the evidence, he said."
Dr Xi was forced to step down from his position as the head of the department during the investigation. He was unable to work on his ongoing experiments and was branded a spy. What are the odds that anyone at the FBI or DOJ will face any personal or professional repercussions? If recent history is any guide they will not even issue a statement. When the case was withdrawn the option to refile was retained, a blatant attempt to save face and deny responsibility.