(FORTUNE Magazine) – NO ONE in the U.S. telephone business has reached out and touched more people --or taken more heat for it--than Harold H. Greene, 62, the federal judge who approved the breakup of AT&T. Newspaper editorials lambasted him for that decision, and he still gets abusive cards and letters about it from irate citizens. Now interpreting the post-breakup rules he put into force has become just as controversial for Greene, who must decide what new businesses the seven new regional holding companies (called RHCs) can get into. That's a huge responsibility. Greene's continuing oversight has prompted angry questions about how a judge has gained such a major role in the phone business. The ebullient Greene is unfazed by the criticism--but there's sure to be more, for his influence on the telecommunications industry is far from over. While the rules he promulgated say RHCs can't get more than 10% of their revenues from nonphone businesses, that permissible fraction amounted to nearly $6 billion last year. So the RHCs' new ventures won't be mom-and-pop affairs and indeed could represent the biggest part of their future growth. Greene insists he's only doing what the law requires. ''The court will, we hope and expect, be one day soon out of the telecommunications business,'' he says. But that day won't come this year or even next. The regional holding companies have ambitious expansion plans--they've already announced their wishes to get into real estate, publishing, software, and consulting, among other things--and Greene must approve every expansion outside their regulated telephone businesses. Other rules restrict AT&T. While deregulated Ma Bell doesn't need the judge's permission to launch new ventures, Greene intends to see that AT&T obeys its promise to stay out of certain businesses, such as electronic publishing. Greene's influence over the phone industry is extending even beyond the AT& T case. His expertise is in effect making him the national telecommunications judge. Last fall, for example, the Justice Department asked that Greene preside over an antitrust matter between GTE and the government concerning long-distance phone service. A court clerk normally assigns cases based on judges' workloads, but the process was suspended after GTE agreed that the issues were so similar to those raised in the AT&T suit that Greene should handle the case as a related matter. It's no accident that Greene's court is the bottleneck for the RHCs' expansion plans. The judge designed it that way. Rather than shunting the approval procedure off to the Federal Communications Commission, which regulated the industry in the past, Greene has insisted on retaining responsibility. A judicial activist, Greene considers the FCC incapable of regulating the broad new world of telecommunications. Some antitrust experts agree that under the law Greene could hardly have avoided taking on the power he now wields. William Baxter, former Assistant Attorney General and chief prosecutor of the AT&T antitrust case that the breakup settled, contends, ''This is one of the problems with the Sherman Act. Administering judgment becomes indistinguishable from regulation.'' Baxter opposes most government interference in business but adds, ''As regulators go, Greene is a pretty good regulator.'' ; Other experts think the judge grabbed more power than he needed to--or should have. His restrictions on new business by the RHCs are ''nonsense,'' says Alfred Kahn, champion of deregulation in the Carter Administration and now an economics professor at Cornell. ''He went way beyond his authority.'' The judge has also been criticized for not turning over some of his decisions to the FCC. Says former FCC Chairman Richard Wiley, ''There comes a time when there should be a shift away from the judiciary.'' A refugee who fled Hitler's Germany in 1939, Greene emigrated to the U.S. via Belgium and Spain, arriving in 1943. After Army service he landed a job as a government translator. He also attended George Washington University's law school at night, graduating first among the night students. As head of the appeals section of the Justice Department's civil rights division, he drafted the legislation that became the Civil Rights Act of 1964 and the Voting Rights Act of 1965. In 1965 he was appointed a local judge in the District of Columbia. He earned a reputation early as a tireless worker. ''It seems no matter what case he's working on, he gives it his utmost,'' says Courtland Traver, a former clerk. Other clerks recall Greene's total devotion to even the petty shoplifting cases that fell under his jurisdiction. ''He always works the same incredibly long hours, blotting everything else out,'' says Traver. Greene seems to relish breaking legal logjams. ''He's a superb organizer,'' says a former clerk. The judge enjoys retelling how he handled the chaotic scene in his court after the assassination of Martin Luther King Jr. ''There were disturbances across the country and thousands of people were arrested,'' he recalls. ''In Northern cities people were being arraigned in groups of 40 or 50. I was encouraged to do the same thing to avoid chaos. I said, 'You can do that, if you declare martial law.' Otherwise, I insisted we follow normal procedures. They said, 'You can't do that.' But we did, working day and night.'' OFF THE BENCH, Greene is friendly and unassuming, his face brightened by a jovial smile. He seldom has time for the Washington social scene, save the Redskins football games. ''I've gone to all the games, rain or shine, for 12 years,'' he says. He keeps a low profile, going out to lunch with his clerks or occasionally inviting them to his house for dinner. Greene and his wife, Evelyn, usually spend nights at home ''watching escapist TV.'' Their two grown children live in Philadelphia and Los Angeles. Named to the U.S. district court in 1978, Greene inherited the AT&T case from an ailing judge. The government's suit was also in sickly shape. It was already more than four years old and had not yet come to trial. ''He vowed that this case was not going to become another IBM,'' says former clerk Stuart Newberger, referring to the 13-year antitrust action that the government eventually dropped. The AT&T settlement stunned the public. But it was no surprise to those who were following the case closely. They say that the judge's outspoken rejection of AT&T's move to dismiss the case was the catalyst that drove the parties to settle. Lawyers on both sides agree that the Justice Department had a good chance to win in Greene's court. He had already declared the government had ''demonstrated that the Bell System has violated the antitrust laws in a number of ways over a lengthy period of time.'' Greene won't play ''what if,'' maintaining that he doesn't know how he would have ruled. ''It was a vast case,'' he says. ''We were in trial every day for 11 months from morning until night. I almost deliberately struck from my mind how I would decide. You run a trial much better if you are not bothered by ultimate decisions.'' During all those months of testimony the judge ran both sides hard. He lashed out at lawyers, berating them for delays. Less than two weeks after the trial finally began, ''the government said it had run out of witnesses and asked for a recess to allow its next witness time to come to court,'' recalls Greene. ''I said, 'Get some more witnesses. I don't care if they are in the right order. I will study their testimony later anyway.' '' ''Greene put together a managerial process to operate the case,'' says Michael Kennedy, a telecommunications analyst at the Gartner Group consulting firm, who was then working for AT&T's defense team. ''He broke down the case into thousands of claims and asked both sides which claims they contested. He handled those paragraph by paragraph. He railroaded the case to some extent. We wondered about due process.'' Says William McGowan, chief executive of MCI, AT&T's biggest competitor in long-distance phone service: ''He really made them toe the line. AT&T had to drop its strategy of letting the case die of its own weight.'' The agreement hammered out by the Justice Department and AT&T didn't satisfy the judge, who under law must decide that such settlements are in the public interest before approving them. Greene's subsequent seven-month review was unprecedented. He solicited almost 9,000 pages of comments filed by more than 600 individuals and organizations and heard additional oral arguments. His handling of the issues impressed courtroom observers. ''He was surrounded by piles of documents,'' recalls MCI's McGowan. ''He'd reach around, dredge up papers from piles 12 inches thick. He'd read along with the testimony, underline passages, make notes, really follow it. Then he'd ask better questions than the lawyers.'' Finally Greene insisted that the decree be reworked. He demanded and got ten modifications to the settlement. Then, last July, he issued detailed rules governing how the RHCs are to obtain the court waivers they need to enter nonphone businesses. The fledgling RHCs are in a dither over the judge's rulings even as they comply with them. They especially object to needing Greene's approval before they act. ''We found the process a significant detriment in negotiating an acquisition,'' Pacific Telesis Chief Executive Donald E. Guinn complained to a group of New York security analysts. Gripes a high-ranking attorney for one of the Eastern RHCs: ''We're in a highly competitive business, and the judge wants us barefoot and pregnant.'' US West, the Denver-based RHC covering 14 states, is mad enough to fight. The company is challenging Greene's authority in a case before the U.S. appeals court, claiming the judge has no right to set conditions on the RHCs, ''which were neither parties to, nor indeed, even in existence at the time of entry of, the decree.'' Adds John Felt, US West vice president for public relations, ''The issue is how our corporate life will be governed. Will we always be subject to a court to decide how we spend our shareholders' money? Do we require IBM to do that?'' No, responds Greene, because ''IBM does not have a monopoly and the regional holding companies' operating units do. If the operating companies mess up, it is bound to be reflected in local telephone service. If they need to be bailed out, it will fall to their rate payers to do it.'' Greene waves off the RHCs' other complaints with a smile and a jab: ''When I heard testimony on the consent decree, there wasn't a peep about these new businesses. They talked of maybe opening a cafeteria for employees. Large-scale new business was never mentioned.'' + Ma Bell's children are not alone in their complaints. Even before the divestiture took effect, on January 1, 1984, Greene was issuing tough rulings that had a huge impact on AT&T. Initially, to strengthen the RHCs, the judge limited the company's use of the Bell name and logo and stripped away its Yellow Pages business. Now the parent is complaining that some of the kids are getting rambunctious. Most notably, AT&T is angry about what it claims is a massive illegal network in Oregon--installed by Pacific Northwest Bell --that bypasses most of AT&T's long-distance lines. AT&T wants to make sure nothing like that is built again without Greene's approval. GREENE RECOGNIZES the turmoil his ruling has caused, but he's convinced that divestiture was inevitable and ''in the best interest of the American economy and public.'' He adds: ''I have no doubt about the correctness of deregulation. The basic fact of the phone industry is it grew up when it was a natural monopoly: wooden poles and copper wires. Once it became possible to bypass this network through microwaves, AT&T's monopoly could not survive. What the Bell System did was illegal. It abused its monopoly in local service to keep out competitors in other areas. Competition will give this country the most advanced, best, cheapest telephone network.'' Evidence of this new competitive thrust continues to pile up in Greene's in- box in the form of briefs, mainly from the more aggressive RHCs asking for greater freedom. Greene admits that relief from this growing judicial burden isn't likely to come from the FCC, which, he says somewhat acidly, ''will not be able to manage the current turbulent telecommunications scene more effectively than it regulated the Bell System.'' Nor does he expect relief in the form of new legislation. But he still believes that the crush of new cases will ease. ''There are only so many ways this decree can be interpreted,'' he insists. Others are not so sure. ''It was naive of the judge to think these companies would passively accept the role of regulated utilities,'' says Kennedy of the Gartner Group. Greene will certainly be remembered as the man who unleashed competition in the phone business. He may also finally earn the public's respect for his years of toil in this new era--while toiling for far more years than he ever anticipated.