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 tries to makes amends to musical artist Jamie Blake after his first music review gets her fired from her job, by trying to get her to perform at the After Dark. Meanwhile, the greedy Valerie ignores Noah's decree to halt the betting at the After Dark, with serious consequences when they both get arrested after the police raid the place. Steve suffers after he and Brandon try to assess Kelly's potential reaction if Brandon tells the truth about his fling with Emma after she threatens to reveal it with an audio tape, and Kelly mistakenly thinks Steve is the one having an affair with Emma when she overhears Brandon and Steve talking about it. Also, Carly thinks Steve is irresponsible with Zack, which takes a turn when she herself loses Zack during an outing at a mall with Donna.