Hours after a new lobbying firm aimed at domestic and global clients announced it was partnering with former national security adviser Mike Flynn, attorneys for the embattled Mr. Flynn said the deal was off and the notice had been released as a result of a “misunderstanding” among the participants in Stonington Global LLC.

“General Flynn has not joined Stonington and did not personally issue any public statement,” Mr. Flynn’s attorneys Robert Kelner and Stephen Anthony said in a statement Tuesday. “He was aware that a statement...