Focus, from the court's transcripts, the deposition from Russell:
"You know that was the room in which the slops were emptied and the water was carried, [i.e. not the girl's bedroom] and that was the morning that Emily Matthews was sick, and you told me of it and asked me to go up and see her, and when they were running out and in with water pails I turned the key for half a minute until I would have a chance to hear quietly what she had to say, and there wasn't the slightest impropriety in anything that was done. I would just as soon that everybody in this room would be present.'"
Mrs Russell didn't contradict this statement in court, namely the part where this incident took place.
The "obviously" assumption is very Watchtowerian in style. In any case, i agree that the reason why Russell didn't sue the Eagle over other much more serious slander articles might well be because litigation over those accusations would probably reveal some skeletons in his closet that he would rather leave hidden - and those would be related to finances. But, I'm afraid we would be merely speculating.
Eden