Carly and Zack temporarily move in with Donna at the beachfront apartment after they are evicted from their house, which was needed earthquake retrofitting. Carly gives Donna advice on her love life as Donna questions whether or not to sleep with Noah. Meanwhile, Dr. Monahan angrily confronts Kelly about her sexual harassment charge against him. David finally admits to Donna that his relationship with Valerie is a farce, but that soon changes when Valerie admits to developing feelings for him again. After Emma quits her job at Brandon's newspaper agency, she puts pressure on him. Brandon is determined to hide their Christmas fling at any cost, and Brandon hires a new writer, Janet Sosna, as Emma's replacement. Valerie as a run-in with Duke, Brandon's former bookmaker, who she tells to stay away from the Peach Pit After Dark, until he offers her a cut of his winnings. Elsewhere, Steve and Brandon rescue David from his carwash job by offering him another job as a music critic for their paper. Zack unknowingly draws on Donna's design sketches just before her meeting with a new potential employer.

David gets caught in the middle of a conflict when the band keyboardist, Mark, blames Noah for his drunk-driving accident and decides to sue. Meanwhile, Donna starts a new photo shoot and deals with a spoiled child model and her demanding mother who spells trouble for her. Steve inadvertently prompts a former frat brother's fiancée, Christy, to call off the wedding. Christy then stays at the Walsh house where she gives Brandon advice on life and love, while her perplexed fiancé, Harry, gives some love life advice to Steve regarding the departed Carly. Kelly counsels a teenage girl who contracted a sexually transmitted disease after cheating on her boyfriend. Valerie, still working community service at the clinic, continues her plan to keep Brandon and Kelly apart, setting up a scene at a restaurant so that Brandon will walk into Kelly with her date Jeff.

After Noah is questioned by the police about Valerie's rape charges, he admits to Donna that he did have sex with Valerie that night at the After Dark club, but he did not know that she was drugged. The only ones who believe Valerie's date rape story are David and Brandon, which drives a wedge between them and their friends. Josh stirs up more trouble for the gang when he gives Donna amphetamines to counteract the pain pills she is now taking for her back injury. Josh also takes advantage of Valerie and Noah's conflict to play them against each other, then persuades Valerie to launch a civil suit against Noah. Meanwhile, Steve and Brandon join a patrol ride-along with Steve's Valentine's date and her partner, and witness Tammy's partner roughing up a suspect. Jasper tells David that the other band members want to drop him from their group.

Valerie's civil suit against Noah begins with her taking the witness stand and testifying about that night. But Noah's attorney viciously cross-examines her, using Valerie's sordid past to discredit her. Then Brandon, Kelly, David, and Steve individually take the witness stand and testify against Valerie, despite her attorney trying to establish reasonable doubt against them. The final nail in Noah's defense cast a mortal blow when the real culprit, Josh, unexpectedly takes the witness stand and testifies against Noah with details about "his" version of what happened the Valentine's Day night with Valerie at the After Dark. Meanwhile, Donna's addiction to pain pills spins out of control when she begins stealing pills from her father's medicine cabinet at the Wyatt Clinic, while she also combats work pressure by plagiarizing a co-worker's ideas for her newest designs. Record executive, Frank Saunders, wants to sign David to a record deal...but not Jasper.

Donna is rushed to the hospital after falling in a coma from an overdose of painkillers where she comes clean with her father about her addiction to pain pills. When Donna admits to her boss, Robert, that she plagiarized someone else's sketches, she is immediately fired. Meanwhile, Kelly cares for a newborn baby left at the clinic by a teenage mother, named Leanne, which makes Kelly wonder if she can take in the baby to care for it herself. Steve falls for Jill, a woman that he has never met, when he starts reading her love letters which are actually addressed to someone else named Ted. Also, Brandon investigates David's sudden success with his new songs where Jasper suggests to him that David's gains for the record deal are ill-gotten. Elsewhere, Valerie struggles to get past her incident with Noah.