WASHINGTON (Reuters) - Lance Armstrong has failed to convince the U.S. government to stay out of a fraud suit that attempts to recover sponsorship money from the banned cyclist, his lawyer said on Friday.

"Lance and his representatives worked constructively over these last weeks with federal lawyers to resolve this case fairly, but those talks failed because we disagree about whether the Postal Service was damaged," lawyer Robert Luskin said in a statement.

(Reporting by David Ingram; Editing by Vicki Allen)