In August 2017, the Special Counsel's Office ("SCO") began to threaten Covington's work
with criminal FARA-related charges by way of an indictment of Mr. Flynn's former business
partner, Bijan Rafiekian. Covington's "underlying work" conflict of interest suddenly escalated
into a non-consentable conflict of interest that tainted every moment up to and through the guilty
plea in December 2017 and the Sentencing Hearing in this Court in December 2018. That
pernicious conflict infected and prejudiced his defense until he retained new counsel in 2019.
storage.courtlistener.com

On the 302 of the agents interpretation, which was edited/reedited for 6 months; Flynn had said he didn't remember discussing the sanctions.
The lie was supposedly he discussed Sanctions with Kislyak (they had the "transcripts"), but after releasing the transcripts showed he hadn't discussed the sanctions, but was discussing the tit-for-tat about the removal of diplomats.

"So, you know, depending on, depending on what actions they take over this current issue of cyber stuff, you know, where they're looking like they're gonna, they're gonna dismiss some number of Russians out of the country, I understand all that and I understand that, that you know, the information that they have and all that, but what I would ask Russia to do is not " is is " if anything " because I know you have to have some sort of action " to, to only make it reciprocal. Make it reciprocal. Don't " don't make it " don't go any further than you have to. Because I don't want us to get into something that has to escalate, on a, you know, on a tit for tat. You follow me, Ambassador?"

Kislyak responded that he did but that Flynn needed to "appreciate" that sentiments were raging in Moscow. Flynn noted he appreciated the situation but didn't want to get into a scenario "where we do this and then you do something bigger, and then you know, everybody's got to go back and forth and everybody's got to be the tough guy here." Flynn stressed, "[W]e need cool heads to prevail ... to fight the common threat in the Middle East."

At that point, Kislyak mentioned "sanctions" for the first time, noting that "one of the problems among the measures that have been announced today is that now FSB and GRU are sanctioned," and Kislyak said it makes him ask himself if the United States remains willing to work on terrorist threats.

Significantly, Flynn did not respond to Kislyak's mention of sanctions with a similar plea to moderate any response. Rather, he merely acknowledged Kislyak's comments with a "yeah, yeah," and then Kislyak noted "that was something we have to deal with, but I've heard what you say, and I certainly will try to get the people in Moscow to understand it."
thefederalist.com

Obviously complicated, and further muddied by a 302 which was poorly handled.