The Santiago Appeals Court also confirmed yesterday the sentence of seven years in prison for retired army brigadier general Pedro Espinoza, a court statement said.
Espinoza was already serving time for those and similar crimes at Punta Peuco prison, a special jail in Santiago for military staff convicted of human rights violations.
The court also reduced the compensation that Chile must pay the victims' families from USD 30,000 to about USD 20,000.
Rafael Gonzalez, a former civilian air force employee, earlier got two years for serving as Espinoza's accomplice in the Americans' death.
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Horman, 31, a scriptwriter working for a Chilean film company, was picked up by a military patrol on September 18, 1973 after being accused of "subversive" activities.
Teruggi, a 24-year-old student who published a leftist newsletter, disappeared soon after.
The two men were taken to the National Stadium in Santiago, where prisoners were interrogated, tortured and executed.
More than 3,000 people were killed and 38,000 tortured during the Augusto Pinochet regime, which lasted until 1990.