Antitrust Probe of Bells Sought in Texas

Five telephone service providers and trade groups will ask the Texas attorney general today to investigate whether regional Bell firms conspired illegally to suppress competition, marking the fourth state where action has been sought.

In a letter to be delivered to Atty. Gen. Greg Abbott, the groups urge a probe into whether the Bells violated Texas law by allegedly arm-twisting suppliers and manufacturers to join a $40-million lobbying campaign and by dividing market territories to avoid competing against one another.

A copy of the letter was obtained by The Times.

The antitrust issues arose after The Times published details from an internal memo about an Oct. 20 dinner attended by Bell chief executives and their counterparts at telecommunications equipment companies such as Intel Corp. and Motorola Inc.

At the meeting, the phone companies through their trade group, the U.S. Telecom Assn., sought support for a lobbying campaign to end price regulation in the industry.

USTA, which hosted the dinner and wrote the memo, has denied that antitrust laws were broken. The association has called such allegations “baseless and slanderous.”

Bell rivals and their trade groups have asked Senate and House judiciary committees and attorneys general in three other states, including California, to investigate the Bells.

House Judiciary Committee Chairman F. James Sensenbrenner Jr. (R-Wis.) has said he believed the Bells’ conduct was protected by the 1st Amendment, and he had no plans to call a formal inquiry. Requests are pending at other agencies.