Optimum Communications (formerly Altice USA) has taken aim at a group of its lenders that it says control not only 99% of its outstanding loans and bonds, and also at least 88% of the US leveraged-finance market and 99% of the secondary market for Optimum’s outstanding funded debt. According to Optimum, by entering into a cooperation agreement, these market participants – which include a steering committee comprised of Apollo Capital Management, Ares Management, Blackrock Financial Management, GoldenTree Asset Management, JP Morgan Investment Management, Loomis, Sayles & Company and Oaktree Capital Management – have formed a cartel to boycott providing essential financial services to Optimum in violation of federal antitrust laws.

Antitrust violations typically call to mind things like the monopolization judgment issued against Google in April 2025, or the US Department of Justice’s district court win in January 2024 blocking JetBlue’s proposed USD 3.8bn acquisition of Spirit Airlines. An agreement among creditors to block a potential liability management exercise (LME), on the other hand, does not seem to rise to that level. Indeed, if only a handful of creditors had entered into the cooperation agreement, this likely would not have been an issue. But here, where the lender group, according to Optimum, controls the US leveraged finance market, which Optimum argues is its only effective means of financing, the stakes are raised. Optimum contends that the group’s agreement not to refinance their Optimum debt or provide new financing absent the consent of two-thirds of the group has left the company with no cost-effective means to obtain liquidity.

In this article, the Debtwire legal analyst team discusses the complaint, the cooperation agreement and the relevant antitrust laws, why Optimum argues that this particular agreement is per se illegal, and it is entitled to treble damages.

Optimum’s funded debt and LME prospects

Optimum, a telecommunications company that provides broadband, video, telephone, and mobile and related services to residential and business customers in the US, has three classes of outstanding debt: loans; senior guaranteed notes; and senior non-guaranteed notes.

The company negotiated its credit agreement and indentures when there was significant market demand for high-interest debt.[1] This gave it the bargaining power to obtain flexibility in its covenants and other terms in its debt agreements. As such, the agreements allow Optimum to take certain actions, including LMEs, with the approval of a majority of creditors. According to Optimum, its credit documents (i) include Dutch-auction provisions that allow it to auction prepayments of its debt at escalating discounts to par,[2] and (ii) allow Optimum to make open-market purchases on a non-pro rata basis. In fact, according to Optimum, in April 2024, creditors began reaching out about potential LMEs, and one (unspecified) creditor “even made an unsolicited proposal for Optimum to engage in a dropdown transaction and outlined the mechanics of such a potential transaction.”

Optimum explains that LMEs are a critical tool for borrowers because they allow companies with funded debt to manage that debt and possibly delay or avert a bankruptcy filing. Optimum also notes that “like all debt transactions, [LMEs] depend on robust competition between creditors.” According to the complaint, the cooperation agreement that the defendants entered into on 3 July 2024 halted Optimum’s discussions with individual creditors, as it is expected to function. Optimum also stated that although some lenders that are parties to the cooperation agreement privately expressed an interest in exploring a deleveraging deal, they told Optimum that the agreement blocks them from even discussing it. Thus, since July 2024, Optimum’s substantive negotiations with its creditors have occurred exclusively through the parties signed on to the cooperation agreement, which has an initial term of 18 months – through 3 January 2026 – with an option to extend for another 18 months.

The steering committee represents the parties to the cooperation agreement and serves as the liaison between Optimum and the group. According to Optimum, the committee controls the group’s decision-making process and exerts significant influence over other members “to keep the cartel intact.” PJT Partners acts as the lender group’s lead financial advisor and represents the steering committee in negotiations, while Akin Gump Strauss Hauer & Feld is the lead law firm.

The “cartel’s” cooperative agreement

Optimum argues throughout its complaint that the lenders who are parties to the cooperation agreement function as a cartel;[3] it uses the word cartel 24 times in its 91-page complaint. Generally, a cooperation agreement is a written contract between at least two of a borrower’s creditors that restricts those creditors’ ability to individually negotiate or transact with the borrower, with the idea that the lender group will increase its bargaining power and protect itself from ending up on the losing end of an LME. To be effective, such agreements prohibit members from selling their debt to any investor that does not first agree to join the cooperative. Similarly, such agreements also provide that any debt that a member later acquires, whether from the company directly or on the secondary market, automatically becomes subject to the agreement. Additionally, cooperation agreements typically:

• require a supermajority vote (typically two-thirds, which is higher than the majority consent required under credit agreements) before any one creditor can transact with the borrower, and bind members to the group’s decisions so that dissenters may not opt out;
• bar members from acting in any way that is inconsistent with the agreement or its objectives; and
• contain enforcement provisions whereby non-compliant debt transfers or acquisitions are deemed void, and other creditors in the group are permitted to seek monetary damages and specific performance to undo any breaches.

According to Optimum, in 2024, 45 creditor cooperatives formed in the US, which is a drastic increase from the average of four per year between 2018 and 2023. Although Optimum has not viewed the cooperation agreement at issue, it asserts in the complaint that, “upon information and belief,” in addition to the general provisions discussed above, it:

• imposes supermajority-consent requirements across classes of debt, “meaning that a minority of holders of one debt class can block transactions in unrelated debt classes.” In other words, an arguably unique aspect of this agreement is that it binds creditors across all of Optimum’s funded debt classes, including its loans, guaranteed notes, and non-guaranteed notes;
• imposes indemnification and other remedies on signatories that violate its terms;
• prohibits members from transferring their debt to Optimum or any of its affiliates so that Optimum will not be able to repurchase its debt at a discount through open market transactions; and
• provides that in any deal the lender group reaches with Optimum, Optimum must pay the fees of Akin and PJT Partners, with PJT demanding that Optimum pay its monthly fees of USD 200,000, a USD 15m transaction fee, and a USD 5m discretionary fee as part of any future deal.

Optimum argues that the “cartel’s” cooperation agreement functionally amends Optimum’s “existing debt instruments after the fact to achieve what creditors could not obtain at the negotiating table” and that for “borrowers and creditors who bargained for the flexibility to employ LMEs, cooperation agreements take away that flexibility on the back end by blocking any creditor from agreeing to participate in one.” According to Optimum, the provisions of the cooperation agreement allow the lender group “to dictate terms to Optimum much like a monopolist would.” For example, Optimum alleged that at a January 2025 meeting, the group’s representatives insisted that they would deal with Optimum only if Optimum amended its debt agreements to forfeit any right to engage in dropdown transactions. Optimum also accuses PJT Partners of telling Optimum that “stripping its existing flexibility-conferring covenants is a clear red line without which no deal will occur.”

According to Optimum, the cooperation agreement shuts it out of the US leveraged finance market in violation of state and federal antitrust laws, heightening the risk of bankruptcy and undermining the odds of a successful debt restructuring.

Anti-trust law overview

Optimum has brought claims under section 1 of the Sherman Act[4] and section 4 of the Clayton Act.[5] Under section 1 of the Sherman Act, every contract in restraint of trade or commerce among states, or with foreign nations, is declared to be illegal. However, the US Supreme Court has held (albeit in 1898) that this section of the Sherman Act is not to be administered as an interference with the general liberty of contract, which is guaranteed under Fifth Amendment.[6]

The Sherman Act was intended to prevent a decrease in competition and the payment of higher consumer prices due to monopolistic activity or anticompetitive conduct. However, not all restraints of trade are prohibited. To rise to the level of a Sherman Act violation, courts require that the restraint must be unreasonable. An unreasonable restraint of trade may either be per se or under the “rule of reason.”[7] With respect to per se violations, courts distinguish between “horizontal” agreements, which “involve coordination ‘between competitors at the same level of a market structure,’ ” and “vertical” agreements, which “are created between parties ‘at different levels of a market structure.’”[8] Horizontal agreements are, “with limited exceptions, per se unlawful.”[9] Similarly, “certain concerted refusals to deal or group boycotts” are generally held to be violations of section 1 of the Sherman Act because they are “likely to restrict competition without any offsetting efficiency gains.”[10] To establish a cause of action under the rule of reason test, a plaintiff generally must show that (i) a relevant market existed that was affected by challenged restraint, (ii) the defendants possessed market power within relevant market, (iii) there was anticompetitive effect in the market, and (iv) the negative effects on competition were not outweighed by positive effects on competition.[11] Under the rule of reason test established by the US Supreme Court,[12] courts balance the anticompetitive consequences against the procompetitive benefits. To determine the anticompetitive effects, courts assess whether defendants have “market power,” – i.e., the ability to raise prices or reduce supply without losing profitability. In doing so, they typically look at whether the defendants have a dominant share of the market and whether there are significant barriers to entry into the market.

Put differently, Optimum may pursue two theories of liability under this part of the Sherman Act. Under the rule of reason, the court must weigh all of the circumstances to decide whether the cooperation agreement should be prohibited as imposing an unreasonable restraint on competition. Alternatively, Optimum must show that the cooperation agreement is illegal per se. For example, price fixing agreements are considered horizontal agreements that are per se unlawful. In addition, Optimum must show that it was injured as a result of the cooperation agreement. In the Second Circuit, where Optimum’s case is pending, the US Court of Appeals for the Second Circuit has held that held that a plaintiff can prove an anticompetitive effect indirectly by showing “market power plus some other ground for believing that the challenged behavior could harm competition in the market, such as the inherent anticompetitive nature of the defendant’s behavior or the structure of the . . . market.”[13]

Under the Clayton Act, any party injured (in its business or property) due to a violation of antitrust laws may sue in a district court and recover threefold the damages sustained, plus the cost of suit, including reasonable legal fees.

Legal arguments

Optimum argues that the cooperation agreement constitutes a concerted refusal to deal with Optimum that is per se unlawful, as it constitutes a horizontal agreement to fix the prices of Optimum’s debt in the leveraged-finance market and market for outstanding Optimum debt. According to Optimum, the cooperation agreement is anti-competitive because (i) it impairs its access to the US leveraged-finance market and the secondary market for trading in Optimum’s outstanding debt, which are the only viable markets for Optimum,[14] and (ii) the defendants dominate both markets.

Optimum explains that borrowers in the leveraged finance market are limited to an investor base that is far narrower than what investment-grade borrowers can access. By cutting Optimum off from refinancing its existing debt or obtaining new debt in the leveraged-finance market, the lender group has, according to Optimum, forced it into a “Hobson’s choice: either amend the contracts to forfeit its hard-fought flexibility, or be starved of capital until it is forced into bankruptcy.”

Optimum further explained that the supply of leveraged financing in the US is limited, as only certain institutional lenders are able to assume and distribute (through syndication or securitization) the requisite level of risk.[15] According to Optimum, the steering committee alone controls over USD 16trn in assets, while the other lenders in the group account for most of the large institutions that dominate the US leveraged-finance market. As noted above, Optimum contends that the lenders who have signed on to the cooperation agreement control (i) roughly 85% of the leveraged loan market, (ii) approximately 92% of the high yield bond market, and (iii) 88% of the leveraged-finance market.

Optimum contends that the agreement impairs competition in the relevant markets in various ways, including that it:

• is a per se illegal group boycott because it dictates that none of Optimum’s creditors may transact with Optimum without the requisite group approval, leaving Optimum without access to the primary and secondary debt markets;
• constitutes illegal price fixing by purporting to set prices for the entire lender group;
• restrains trading, depresses liquidity, suppresses output and reduces the amount of capital available in both markets; and
• inflicts anticompetitive effects beyond Optimum. By restraining transactions between Optimum and otherwise-willing creditors – such as open-market purchases of Optimum’s outstanding debt – the agreement locks up creditors’ capital and prevents them from redeploying it throughout the leveraged-finance market.

Instead of having a pro-competitive effect to counterbalance these anti-competitive consequences of the agreement, Optimum has accused the steering committee of being motivated to drive it into bankruptcy, perceiving it as preferential for large creditors versus an out-of-court restructuring. According to Optimum, the steering committee appears to be working to “to squeeze out minority lenders” by providing DIP loans on advantageous terms. Optimum explains that debtors in bankruptcy lack a “true market” for DIP loans, allowing “the debtor’s dominant pre-petition lenders to augment their control of a Chapter 11 case.”

In terms of harm caused by the cooperation agreement, Optimum asserts that it was forced to overpay for a USD 1bn asset-backed private financing loan it took out in July 2025. In connection with that loan, Optimum moved network assets and customer contracts from the Bronx and Brooklyn to a separate, bankruptcy-remote entity to support the loan. Optimum argued that because the cooperation agreement “decimated the pool of potential lenders,” it had to pay an interest rate that far exceeds the rate on similarly rated loans issued in comparable circumstances: “According to a contemporaneous estimate from a third-party advisor, Optimum had to pay the lender roughly 200 basis points more than ordinary market rates for similarly rated loans. Further, Optimum had to agree to atypical non-economic terms that limited its flexibility to borrow additional amounts against those assets, even though they were rated for significant additional capacity.”

However, Optimum asserts that the cash generated by a discrete pool of assets, like those in its Bronx and Brooklyn perimeter, cannot support financing large enough to enable it to manage its debt, and therefore asset-backed private loans are not a practical substitute for the traditional corporate loans that it otherwise would be able to obtain in the leveraged-finance market. According to Optimum, in a competitive market, it would not have pledged “these prized assets to support a private, asset-backed transaction that was so expensive,” but was forced to do so as it had no other option.[16]

When bad facts make bad laws

As discussed above, Optimum appears to have sufficiently pleaded the elements of a violation under the Sherman Act. However, a ruling in favor of Optimum would be no less than groundbreaking, as there does not appear to be any legal precedent that prohibits this type of activity among lenders. Moreover, it would be a troubling encroachment on lenders’ rights to enter into contracts with other lenders to manage their investments. Given the aggressive LMEs that have led to recent litigation, including Serta Simmons’ uptier transaction and STG Distribution’s dropdown transaction, to name a couple, it makes sense that lenders would look to contractually protect their investments from by ensuring that they are not among the “excluded lenders” left holding the bag after a LME transaction. Moreover, lenders participating in syndicated loans regularly form ad hoc groups agreeing to cooperate with each other in connection with a borrower’s refinancing efforts – both in and outside of Chapter 11.

The main difference here, however, is the sheer size of the lender group that signed on to the cooperative agreement. Optimum’s counsel certainly picked the right cooperation agreement to attack under antitrust law. As they put it in the complaint, “This Cooperative is (to Optimum’s knowledge) the largest in existence, and its membership includes most institutional corporate creditors. Its continued existence serves as a model for copycat efforts and, on information and belief, contributes to their propagation. Left unabated, similar cooperation agreements will become standard operating procedure for creditors – spurred on by advisors like PJT and Akin who, in pursuit of lucrative business opportunities, organize and promote such agreements.”

Optimum was not the first to bring a lawsuit attacking cooperation agreements under antitrust law. On 28 October 2025, certain funds that hold first lien notes issued by Selecta Group BV, a Dutch company, commenced litigation against the issuer, Selecta Group AG, a Swiss company in liquidation, and certain of their affiliates, arguing that Selecta carried out an anticompetitive scheme with a group of its favored noteholders in violation of the indenture and state and federal antitrust laws (including section 1 of the Sherman Act) when it entered into certain transactions in accordance with a cooperation agreement between those parties. The litigation commenced against Selecta and Optimum’s litigation are both pending in the US District Court for the Southern District of New York before different judges. Judge Jeannette Vargas has been assigned to the Optimum action, while Judge Lewis Kaplan has been assigned the Selecta litigation. While the increase in cooperation agreements signals attempts by lenders to combat aggressive LMEs, these lawsuits signal an attempt on the borrower’s side to counteract those efforts.

Both cases will require expert testimony as to the cooperation agreements’ respective impacts on the market and factual testimony to support allegations of harm suffered by the plaintiffs. As such, we would expect both trials to entail a significant drain on the parties’ time and resources.

If Optimum succeeds on its claims, courts – and lenders – will be left wondering when a cooperation agreement will have too many members to pass muster, or when its terms will be so onerous that it obstructs competition. Where will the line be drawn? Should lenders be forced to be pitted against one another in LME transactions and ensuing costly litigation that could be avoided by a cooperation agreement? To the extent that cooperation agreements drive up financing costs for borrowers and leave them with no alternative to adequately manage their capital structures, that could become a new reality – unless of course lenders successfully implement a strategy to keep their cooperation agreements beyond the reach of US antitrust law, perhaps by designating a foreign law as the governing law of such agreements.

Related Links (Access Required):

Optimum Complaint 
Selecta Complaint
Debtwire Dockets: Optimum Communications, Inc. et al v. Apollo Capital Management, L.P. et al
Debtwire Dockets: Evolution Credit Opportunity Master Fund II-B, L.P v. The Entities Listed on Schedule 1

Prior to joining Debtwire, Sara was a law clerk to two judges in the United States Bankruptcy Court, S.D.N.Y. and practiced in the Financial Restructuring Group at Clifford Chance, where she represented financial institutions (as secured and unsecured creditors, defendants in adversary proceedings, and participants in DIP financings) in high-profile restructurings. She also represented foreign representatives in Chapter 15 cross-border cases.

This report should not be relied upon to make investment decisions. Furthermore, this report is not intended and should not be construed as legal advice. ION Analytics does not provide any legal advice, and clients should consult with their own legal counsel for matters requiring legal advice. All information is sourced from either the public domain, ION Analytics data or intelligence, and ION Analytics cannot and does not verify or guarantee the adequacy, accuracy or completeness of any source document. No representation is made that it is current, complete or accurate. The information herein is not intended to be used as a basis for investing and does not constitute an offer to buy or sell any securities or investment strategy. The information herein is for informational purposes only and ION Analytics accepts no liability whatsoever for any direct or consequential loss arising from any use of the information contained herein.

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[1] Unless otherwise indicated, all such facts are as alleged by Optimum in its complaint, and all quotations are to the complaint.

[2] The procedures require Optimum to extend discounted prepayment offers to all applicable term lenders.

[3] Further likening the defendants to a mob-like cartel, Optimum contends that “Cooperatives and their steering committees use coercive tactics to boost recruitment. Cooperatives often set artificial deadlines to join; wait too long and the cooperative will close its doors, leaving the creditor to fend for itself. Many creditors’ status as repeat players in leveraged capital structures amplifies the pressure. Creditors have powerful financial incentives to maintain goodwill with their rivals and not break rank, for fear of being excluded from the next cooperative to form.”

[4] 15 U.S.C. § 1.

[5] 15 U.S.C. § 15.

[6] See U.S. v. Joint Traffic Ass’n, 19 S.Ct. 25, 171 U.S. 505, 43 L.Ed. 259 (1898).

[7] See Wallach v. Eaton Corp., 814 F.Supp.2d 428, 439 (D. Del. 2011).

[8] See Anderson News v. American Media, 123 F.Supp.3d 478, 497 (S.D.N.Y. 2015).

[9] Id.

[10] See id. 

[11] See Spanish Broadcasting System v. Clear Channel Comm’s, 242 F.Supp.2d 1350, (S.D.Fla.2003) affirmed 376 F.3d 1065.

[12] Standard Oil Co. of New Jersey v. US, 221 U.S. 1 (1911).

[13] Tops Markets v. Quality Markets, 142 F.3d 90 (2d Cir. 1998).

[14] According to Optimum, the private lending and investment grade loan market are not reasonable substitutes for leveraged financing because private lending imposes higher costs and more onerous contract terms (and private loans do not trade on secondary markets like syndicated loans and bonds). Similarly, Optimum explains why equity financing is an inadequate substitute for leveraged debt financing.

[15] Optimum explains that significant barriers to entry and expansion protect the lender group’s market power in the leveraged-finance market and that consequently, a finite number of longstanding, sophisticated creditors participate in the that market.

[16] In the complaint, Optimum asserts that PJT Partners told Optimum that it had overpaid on the asset-backed loan by at least “200 basis points.”