For about three years - ever since the head of Bell Telephone's Texas operations killed himself and left suicide note as setting that "Watergate is a gnat compared to the Bell system" - San Antonio has been the setting for an explosive drama. Now the final scenes are being played out in the Alamo city before a jury in a $29 million suit against Southwestern Bell, one of the system's most profitable subsidiaries.
Although the suit is basically a defamation of character, libel and slander action against the company, it also accuses Southwestern Bell of illegal wiretapping, operating a political slush fund and corrupting rate regulators, including a number of council-men in various Texas cities.
The suit was brought by former Bell executive James H. Ashley, an ally of T. O. Gravitt, the man who killed himself, and by Gravitt's widow and two sons. Ashley, 47 and a 23-year veteran of the phone company, had salary and benefits amounting to $70,000 a year, headed a department of 12,000 in San Antonio and was responsible for pushing through rate increase requests in nearly 200 Texas cities and towns.
An earlier jury awarded Ashley and his wife $1 million in damages on grounds that the company had invaded their privacy with secret wiretaps, an action separate from the current suit.
The present suit has been in trial before a state court jury for about a week and a half and the trial is expected to continue for perhaps two weeks more. This week Ashley testified that Bell launched an investigation fo Gravitt in 1974 because William L. Lindholm, then the president of American Telephone & Telegraph Co. wanted Gravitt removed from the Bell hierarchy because Gravitt opposed the company's allegedly inflated rate-fixing practices in Texas, which Gravitt adn Ashley considered to be deceptive, unfair and susceptible to exposure.
Lindholm, who recently retired, had served as a Southwestern Bell executive in Texas, and Ashley described him as "the man who set up this great bilking system."
Ashley testified that he was suspended on Oct. 9, 1974, in an attempt to force him to incriminate Gravitt. After the suspension, Ashley said, he was interviewed by two Bell security agents who "seemed obsessed that Gravitt, through me perhaps, was getting massive amounts of money" in kickbacks from a printing firm.
When Ashley insisted he knew of no wrongdoing by Gravitt, he testified, the security men turned to allegations that Ashley had sexual liaisons with bell female employees, which Ashley denied. C.L. Todd, vice president and general manager for Southwestern Bell in San Antonio, has testified that Ashley was fired because, among other reasons, he solicited sexual favors from female employees for promotions.
Nine days after Ashley was suspended, Gravitt killed himself during a Bell internal investigation that the suit contends hounded him to death. His suicide note said that the Bell agents had questioned more than 150 people and "in doing so have caused irreparable damage to my reputation" by asking questions about whether he had solicited gifts from subordinates whether they had "fixed him up." with women, and whether he had made passes at or slept with female employees. After adding that his son Mike should "see a good lawyer," Gravitt appended eight pages of "things to subpoena" plus other allegations that formed the blueprint for the suit filed later by San Antonio attorney Pat Malloney.
Gravitt's widow said she saw her husband "crumble before my own eyes" during the Bell investigation. Ashley has testified that Bell Vice President Todd offered him $110,000 in cash and a $20,000 pension for life "if I would resign quietly and disappear from the scene." When he refused the offer, he was fired on Oct. 31, 1974, he has said.
Earlier, Todd had testified that Ashley had asked for $485,000 and had said he had wanted to remain with the company as a consultant. After that, Todd has said, Ashley asked for a one-year leave of absence after which he offered to "disappear."
Other testimony has tended to corroborate Ashley's charge that Bell collected money from top Texas executives to operate a political fund. Since Gravitt's death, city councilmen in Dallas, Forth Worth, San Antonio, Austin have acknowledged receiving business from Southwestern Bell or other Bell subsidiaries.
Up until this year, city councils in Texas regulated telephone rates and Ashley has said the contracts and political contirbutions were designed to win council support for Bell's alleged inflated rate requests.