By David Ingram

WASHINGTON (Reuters) - Lawyers for the U.S. Justice Department and for congressional Republicans told a federal judge on Tuesday they were in talks to settle a suit stemming from Operation Fast and Furious, a botched probe into gun trafficking to Mexican drug cartels.

While far from certain, a settlement would bring a quiet end to a political furor that stirred the passions of gun owners, ended some Justice Department careers and led Republicans to find U.S. Attorney General Eric Holder in contempt.

The lawyers said they were uncertain whether the talks would be successful, but that they met on Monday and will meet again.

Republicans in the House of Representatives sued Holder, head of the Justice Department, in August to enforce a subpoena to obtain documents pertaining to the probe.

The contempt vote came in June when Republicans accused the Obama administration of withholding documents related to how it responded to the Fast and Furious operation, named after a movie about auto racing.

U.S. District Judge Amy Berman Jackson encouraged settlement talks during a 30-minute hearing on the case in federal court in Washington, D.C.

Federal judges have rarely addressed the complicated questions raised in the case about relations between the White House and Congress, Jackson said. One side or the other might not want to live with a potential "all or nothing" decision that a settlement would avoid.

"There may be some benefit in trying to work it out, either among yourselves or with the help of a mediator," she said.

A lawyer for House Republicans, Kerry Kircher, said he expected the sides to meet again in the near future, but added: "I cannot express any expectation about the outcome of that."

A settlement would be "the appropriate course here," said Justice Department lawyer Ian Gershengorn.

UPROAR OVER OPERATION

Congressional uproar over Fast and Furious led to at least three high-level resignations or retirements from the Justice Department or the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives.

Fast and Furious was launched in 2009 near the U.S.-Mexico border in Arizona as a response to gun trafficking that fed violence among drug cartels. Continued...