It rather depends on the reason for the decision to put you on the blacklist.
In general, AT&T was allowed its monopoly power under government regulation. A goal of the Communications Act of 1934 was to provide universal telephone service. Section 254(b) lists the Universal Principles, including (4), "All providers of telecommunications services should make an equitable and nondiscriminatory contribution to the preservation and advancement of universal service."
If your service was cut off because you liked to pump line voltage through the phone system, then they could do that because it's a nondiscriminatory meant to protect the phone service.
If they cut you off because you wrote a letter to the editor complaining about their services, then that's discriminatory, and you could take your complaint to the local public utilities commission or FCC ... or perhaps sue as well; I don't know the regulatory history.
In any case, there was certainly government oversight of what AT&T could do, in terms of putting someone on a blacklist.