I agree with Pork Store and jouster. I don't think Phil is gay, (they are not going to repeat a storyline like that again this soon after Vito, it just wouldn't be original.) I do however think that it is one of those wink-wink things between the writers and viewers that Phil took part in some homo-sexual activity while in prison for 20 years. I don't think it will be anything ever mentioned directly in an episode or anything, it's just one of those things that is implied. Tony's refrence to Melfi about guys who spend a lot of time in the can get a pass, Phil "coming out of the closet" in the hotel room during Vito's hit, his blatant homophobia and general disgust of Vito. A lot of characters had a problem with Vito after they found out, but nobody got as worked up as Phil.