Today Flynn's team responded. Margot Cleveland has attached the response to a tweet. What follows is what could be termed a summary and paraphrase of the most important points. When particularly necessary I've placed certain passages within quotation marks, but most of it is not far from verbatim.
Flynn's team takes advantage of Judge Sullivan's demand to do a bit of lobbying. Thus, the most important point is not that they expect no effect on sentencing, but that Flynn's team has, in the course of their continuing review of the Flynn case file, already identified "crucial and troubling issues that should concern any court." This is a clear confirmation, in my view, that they will be attacking the guilty plea and the entire underlying basis for the prosecution of Flynn. So ...
Despite intimations in the Government's response that it will try to increase Michael Flynn's sentence, depending on his testimony, if any (in the Bian Kian trial), there is no basis for doing so. Regardless of who calls Flynn to testify, his testimony will be consistent with his grand jury testimony. [Note, she doesn't say with anything he may have said in plea negotiations.]
Flynn's new counsel are finding the time they've received to review the massive file even more important than they thought. They have only scratched the surface, yet are already identifying "crucial and troubling issues that should concern any court."
Flynn's counsel are not yet in a position to brief the court on the significant issues they've already uncovered, because they've been busy preparing Flynn's cooperation in the Bian Kian trial. In the course of this Flynn has continued to respond truthfully to government questions--which the government doesn't like. Nevertheless, his answers remain consistent with his GJ testimony. [In almost so many words, they are accusing the Government of suborning perjury.]
If the government's case in Bian Kian collapses, that will be no fault of Flynn's--who has cooperated fully--and should have no effect on sentencing. He cannot acquiesce to the Government's demand for untruthful testimony.
The judge in the Bian Kian case has held that the Government has not proffered evidence sufficient to establish a conspiracy for the purpose of admitting "co-conspirator statements." [The Government wants to call Flynn a "co-conspirator".] Further, the judge has held that statements in Flynn's FARA submission do not "allow any inference of the alleged conspiracies."
Flynn's counsel expect to further brief Judge Sullivan on 8/31/19, at which time they also expect to ask for more time to continue reviewing the file.
Note the calm tone of the response. Flynn's team does not seem to have been taken by surprise. For a somewhat hysterical reaction, see CTH.