The problem is the federals misidentified the flag originally. They said it came from a regimen and lanes brigade which was not engaged.

The 23rd North Carolina was part of Johnston‘s North Carolina brigade. It was engaged in a fight at Dabney’s mill against union infantry. Meanwhile, the union cavalry was engaged in a separate fight on the vaughn Road against pegram’s Virginia brigade and Lewis North Carolina brigade

Therefore, the eighth Pennsylvania cavalry could not have captured the flag of the 23rd North Carolina

Bryce