In an eleventh hour move to stop Amber and C.J.'s wedding in October 2000, Rick tracked down Deacon Sharpe, the biological father of Little Eric, to sign over parental rights to Rick and Amber. Rick offered Deacon $100,000 for full custody of Eric III and he agreed. When Deacon faltered, Jonathan initiated a plan for the Forresters to force him into the deal. Deacon discovered a bug and recording device, so took the papers and left the Forresters empty handed. The Spectras and Forresters started a bidding war for Little Eric. Deacon took the child to live with him and his girlfriend Carmen, at his apartment above his club, The Lair. Deacon's attraction for Amber soon developed into much deeper feelings of affection. Carmen became suspicious of Amber's constant visits and Deacon's motive for not accepting their million dollar offer. Carmen's jealousy intensified one night when she took Little Eric to the rooftop of Deacon's building. Amber confronted Carmen who hesitantly returned Eric to Deacon. There was a struggle and Carmen fell to her death.
Deacon's father Daryl paid him a visit and left him battered and unconscious. Deacon vowed to be a better father than Daryl ever was as he continued to develop feelings for Little Eric. A legal arrangement outside the Forrester family influence had Amber agree to a four month live-in arrangement with Deacon and Little Eric, then Deacon would relinquish all parental rights and let Amber walk away with Little Eric. Brooke's interference and convincing photographs of Rick and Amanda kissing at their interstate tennis match drove Amber into Deacons arms. A friendly kiss was interpreted by Rick as a reason to end his engagement to Amber. Deacon organized a surprise getaway for Amber to Las Vegas where they bonded. An encounter with Daryl led to a breakthrough for Deacon in overcoming his childhood demons. Stephanie informed Rick of Brooke's manipulation and searched for Amber. Rick and Amber soon reunited and planned to marry. Amber asked, and Deacon agreed to sign papers releasing her from the four month agreement but allowing visitation to Little Eric. Eric, Stephanie, Brooke, and Thorne visited Deacon at his club. He was furious when Eric boasted about not having to pay him the million dollars. Deacon ordered them out and promised that they would all pay for the abuse. Deacon soon developed a friendship with Bridget, and both were unaware of who the other was until Bridget left Deacon her number revealing she was a Forrester. Deacon came clean and told her his name. Bridget was stunned when she realized who he was, but Deacon manipulated her into thinking he cared for her. Before moving ahead with his plan to use Bridget, Deacon tried to get Rick, Brooke, and Amber to stop the wedding. When Amber and Rick's wedding began, Eric stood up and asked the minister to stop and demanded Deacon leave immediately. Eric and Brooke were mortified when Bridget announced that Deacon was her date! Amber and Rick were married.
The guests were asked to leave, and Deacon and Amber went to the den to talk while the rest of the Forresters tried to make Bridget see Deacon's true intentions. When Rick, Eric, and Brooke entered the den, Deacon forced them to choose between Amber and Bridget stating he would be leaving with one of them. Eric, Ridge, and Thorne beat Deacon before throwing him out of the Forrester mansion. Bridget ran after him. In the car, Deacon proposed, they drove to Las Vegas and got married. The Forresters were shocked and appalled when they learned of Bridget's marriage and resolved the situation temporarily by letting the newlyweds stay at Taylor's Beach house without any family interference. When Eric, Brooke, and Rick called Deacon on the speaker phone demanding Bridget be sent home, Deacon retaliated by leaving the phone off the hook as he made love to Bridget. The following day, Deacon was hit by a car as he exited Insomnia. At the hospital, Bridget's faith in Deacon was strengthened when he chose not to press charges against the driver who hit him who was Eric.
Deacon showed guilt over his actions related to Bridget but felt it was necessary to get Amber and his son, (whom he now called "Little D") back. Bridget was devastated when she overheard Deacon admit to Amber that their marriage was a farce. Bridget confronted Deacon after Amber left. Deacon followed Amber with Bridget close behind. Deacon watched helplessly as Bridget slammed her foot on the accelerator, lost control, and swerved off the road. While Bridget was unconscious and still recovering from surgery, Deacon realized he had feelings for her. Deacon admitted he didn't realize how important Bridget was to him until then, and he wanted to make their marriage a real one.
Despite hesitation and pressure from her family, Bridget decided to give their marriage a second chance. After Brooke insisted that Amber and Deacon discuss their feelings with one another, the two of them agreed to part ways and make their respective marriages work. Eric had a high fever and brought Amber and Deacon together. They shared a passionate kiss. Amber learned she was pregnant with Rick's baby. Deacon told Bridget not to worry about her birth control and fantasized about making love to Amber. Brooke begged Deacon to divorce her daughter Bridget, and Deacon, beginning to feel that he was holding Bridget back, agreed to leave her. As they discussed stupid things they had done in the name of love, Brooke and Deacon gave in to their attraction for each other and made love.
At Big Bear, Deacon asked Bridget for a divorce, confessing that he had slept with someone else, but he still loved her. Bridget stood by her man and gave him another chance. Learning she was pregnant, Brooke didn't tell anyone and went to a spa while Deacon stayed in LA with his wife. Deacon helped Rick save Brooke's company from being taken over by Ridge. Brooke rewarded Deacon with the job of Head of Promotions at Forrester. After news of Brooke's pregnancy came out, Whip Jones, the man who would have gotten Deacon's promotion, claimed to be the father and blackmailed Brooke. Deacon was furious when Whip tried to seduce her away from him, and he continued his affair with Brooke off-and-on for months. Brooke couldn't take the guilt of an affair with her daughter's husband, and moved to Paris with Whip so she would be able to fight her urge to be with Deacon. Deacon went to Paris after a disturbing phone call from Whip and again slept with Brooke. Feeling so horrible about hurting her daughter again, Brooke accepted a marriage proposal from Whip, assuming her affair with Deacon would end.
Deacon married Macy in 2003, and the two raised Little Eric together. Macy died in a tragic accident not long afterward, and Deacon was left to raise his son alone. He tried to get his ex-wife Bridget back, but she was committed to Oscar Marone. Deacon began an affair with Jackie Marone. When Massimo had a stroke, Deacon delighted in tormenting him by telling him about his affair with Jackie, even drugging Jackie, with Massimo fully aware. Massimo recovered but Jackie stayed with Deacon. Shortly after Heather Engle came to work for Deacon, he started having the old craving for liquor, not realizing that Heather was in league with Massimo to get revenge on Deacon. After realizing he couldn't stop drinking, Deacon left Los Angeles to get his life back together, leaving Jackie behind.
Four years after he left Los Angeles, Deacon showed up in Genoa City claiming to be an Art Entrepreneur, when actually he was behind the manipulation of Daniel to forge the painting supposedly to help the FBI. When that failed to get Daniel jailed and free Amber for him, Deacon arranged for the painting to be found by the FBI behind the plaster wall of Daniel's loft apartment. Deacon then propositioned Amber that he would turn over a video exonerating Daniel if she would have sex with him, so she did. Deacon made sure Daniel was on the line and left the phone off the hook so he could overhear. When Amber went to see Daniel in jail, he went off on her and refused to believe her explanations. But when the DVD and Michael convinced A.D.A. Heather to let him out on bail again, he began having second thoughts. But the charges were not dropped, and Daniel became a suspect in the death of "Balfour".
Victoria and Deacon closed an art deal with champagne in his suite, and were getting cozy when Amber interrupted. Victoria left before it went any further. But within days, after an argument with JT, Victoria went to Deacon"s room at the Athletic Club and they had sex.
Jana discovered Deacon had possession of both Daniel"s forgery and the original painting. Amber could not be talked out of trying to get the goods on Deacon, and took him up on his proposition to marry him to protect Daniel. Ryder, who works for Deacon, confessed to Kevin that he killed Balfour whose real name was Ray Elkins. He said his dead father, who knew Elkins in prison, locked him in a cellar when he was a kid and Elkins treated him the same way too, so he killed him. Kevin didn"t believe the coincidence when Ryder claimed his dad was Tom Callahan (an alias Kevin"s father Terrible Tom used) but had a DNA test done which confirmed that he was. Deacon visited Ryder in jail, confirming that Deacon had made him confess to the murder. Daniel got Ryder to confess the plan, then stopped the wedding of Deacon and Amber, making a deal to use the key to Tom"s safe deposit box in Detroit to retrieve the original of the Terroni painting Daniel forged for Deacon. With his flight not until the next day, Daniel and Amber made love all night, then he proposed, calling her his true soulmate.
Because the bank refused Daniel admittance to the box, he returned with Amber posing as Tom"s bereaved widow Gloria. But just after they got into the box and retrieved the painting, Gloria showed up. They convinced her to play along, and got the painting back to Genoa City, where they bickered about what to do with it since Deacon had promised Gloria five million to get it for him, Jana felt it should be returned to the museum, and Daniel needed it to give to Deacon for his and Amber"s freedom. Kevin hid the Terroni painting at Crimson Lights, but Gloria found and took it to Deacon. Daniel tricked her, got it back, and returned it to the museum. He received a $25,000 reward, but gave it to Kevin to bail out Ryder. Kevin insisted Ryder come live with him and Jana while he got a new start working at the coffee shop. Daniel was arrested and jailed again, but Phyllis led a search of the landfill where all their friends showed up to help, and found the satchel that was tossed by the killer as he ran away. DNA evidence on the ski mask inside proved that the killer was a female, and Daniel was released. Unknown to everyone else, Deacon, Ryder and his twin sister Daisy discussed their plot against Daniel which was masterminded by an unknown woman, their next target being Lauren who started getting visits by dead and live rats. Before Deacon was arrested and sent to prison for kidnapping and accessory to murder of Ray Elkins, Amber got him to disclose that his son "Little D" a.k.a "Little Eric" was living with Amber"s mother.
One stormy night in July, Phyllis had a blowout as she drove out to the Abbott cabin to see for herself if Nick had gone running to Sharon"s rescue again. Determined to change the tire herself, a car stopped and Deacon got out. As Phyllis said, "What luck " who comes to her rescue but the guy who framed her son." Deacon explained that he had done what he did to Daniel because Sarah was threatening Deacon's son, Eric, and that he had completed his sentence and was on his way back to California. After Phyllis got cut on her hands, he convinced her to let him change the tire. Finding her spare to be flat, he left to get another tire. Nick came upon the still stranded and wet Phyllis, but she sent him away. When he returned later, Phyllis grabbed Deacon and kissed him to make it look like they were necking, which sent Nick away angry. When Nick came to see her the next day, she let him know she was done being his doormat, and was leaving town for a week with Summer. Upon her return, she stopped at Jimmie"s Bar and spotted Nick necking in a booth with Christine Blair. She later arranged to meet Jack at Gloworm, and while she waited for him she was served a drink by their new bartender, Deacon. Jack walked in just as Phyllis slapped Deacon for trying to kiss her.
Meggie McClain continued to spike Nikki Newman"s soda and tea, causing Nikki to go to both Paul and Katherine for support and return to Alcoholics Anonymous meetings when she realized she was being drawn to alcohol again. But Nikki began showing up at Gloworm and getting drunk. One night, Gloworm bartender Deacon Sharpe, who had befriended Nikki at A.A., helped her home and began counseling her. But when Deacon spotted Meggie slipping Nikki drinks, he offered to help Meggie take down Nikki so she could get Victor for herself, if he would be well-compensated. Meggie told Nikki that she had noticed liquor had been disappearing from the bar, and that maybe they should let Victor know he had a thief on the staff. Nikki quickly said no, she would handle it herself. But Meggie made sure that Victor found out about it, Victor took the hint and asked Nikki if she was drinking again, causing her to run off to Deacon who faked going off the wagon with her. When Nikki returned home looking disheveled, Victor confronted her and ended up postponing their elopement.
Meggie accompanied Nikki to the hospital to see Murphy, causing his heart monitor to spike, and Nikki went for a nurse. Then Brock called to check on them and Kay and Nina left the room to get better phone reception, leaving Meggie behind. Meggie warned Murphy that he had better stop trying to use Morse Code to communicate with his eyelids, that she knew all his tricks from when she was married to Murphy"s son. Nikki told Meggie to take her car home and hired a driver to take her to Deacon"s hotel room where she began drinking again. But when she arrived home she and Victor made up and decided to get married in a couple of days. Meggie called Deacon to let him know they had to come up with something to stop the wedding, and fast.
The day that Victor and Nikki were to leave for Las Vegas, Meggie made sure to spike Nikki"s tea during a wedding dress selection at Fenmore"s. Afterward Jill found Nikki"s glass and told Victor that Nikki had been drinking. Victor confronted Nikki which sent her running to Deacon"s hotel room. After Nikki passed out, Deacon and Meggie arranged for Victor to arrive and find Nikki in Deacon"s bed with him. Victor called off the wedding and checked Nikki in to Solidarity House for rehab. Then Meggie arranged for Deacon to be admitted there as well. When Nikki saw Deacon, she warned him to stay away from her. Meanwhile Meggie took over at the ranch, playing the faithful friend to "poor Victor".
Victor ran into Deacon outside Nikki"s room and yelled at him causing a scene. When Nikki defended Deacon for helping her, Victor tore into her for always falling for a lowlife when things got tough, so Nikki threw him out. Deacon realized he cared for Nikki and told Meggie he wanted no part of her con anymore.
Meggie visited her safe deposit box for what were apparently the same drugs she used on Murphy"s son, Francis. Meggie had made plans to drug Victor, fly to Las Vegas and get married; then afterward make sure that Victor died from a sexual enhancement drug reaction on his new heart, making her a rich widow. Meanwhile, Murphy had finally gotten through to Ronan tapping his finger with Morse Code to warn him of danger. All went as Meggie had planned, they returned to the ranch, and once she had given Victor the drug, she got cocky, asked him how he felt and told him that he was about to die and make her a rich widow. But Victor suddenly came out of his stupor, grabbed Meggie by the hair, and told her he was on to her, and that he had tricked her into confessing her intention to murder him. Ronan and Heather walked in, and Murphy in a wheelchair pushed by a policeman, his eyes zeroing in on Meggie accusingly. Meggie squirmed while Ronan explained that Murphy had exposed her by using Morse Code. Heather informed Meggie that they knew of her murder of Francis Murphy and Meggie was arrested and taken to jail.
Back at the rehab clinic, after hearing the news of Victor and Meggie"s marriage, Nikki jumped into bed with Deacon for solace. Victor walked into her room unannounced and caught them in bed. After Deacon left, Victor told Nikki that the marriage was a ruse, that Meggie had been conning them while slipping Nikki alcohol get her out of the picture. A livid Nikki suddenly turned contrite, begging Victor to forgive her for not trusting him. Victor walked out, hurling insults, and promised to never have anything to with Nikki again. Victoria arrived and consoled Nikki that their breakup had been Meggie and Victor"s fault, not her own. Nikki decided that it had been yet another sign that she and Victor were just not meant to be. Back at the Chancellor Estate, Murphy was able to speak and told Kay, "I love you old girl."
Both out of rehab and sober four months, Deacon and Nikki shared some intimate moments on the dance floor at the Valentines benefit at Gloworm, until Victor presented a large donation to the puppy love fund and declared Diane the woman in his life while Nick, Nikki, and Deacon looked on.
In February, 2011, Meggie was returned to Genoa City's jurisdiction because Alaska could not make the murder charge stick. Deacon threatened Meggie that he would testify against her if she told Nikki about his involvement in keeping Nikki off the wagon. Nikki warned Victor that Meggie was back, but he blew if off, and let her know that Diane was moving in with him. Then after Nikki left, he called Michael and told him to make sure Meggie never went free. Nikki visited Meggie in jail and gave her hell for ruining Nikki's sobriety and her marriage, and nearly killing Murphy, then warned her to stay out of her life. Meggie kept calling Deacon and threatening to tell Nikki if he did not get her out of jail.
Desperate to get Meggie off his back, Deacon arranged a conjugal visit with Meggie in jail, where he took off the medical scrubs he had on under his clothes and an ID badge, telling her he'd seen an escape like it work on TV. Meggie put them on under her jumpsuit and later attempted to escape in them. But she was caught just outside the back door, following Deacon's tip to a guard.
After Meggie's urgent request, Nikki went to the jail and found Meggie in chains awaiting transport to prison to await her trial. Meggie disclosed to Nikki that Deacon had been in cahoots with her in getting Nikki to drink again. Deacon broke in on them, but was unable to convince Nikki that he really loved her. Nikki called Nick trying to find Victor, but Nick had to break it to her that Victor and Diane had eloped to Las Vegas. Nikki went to Gloworm looking to drown her sorrows in a drink and walked in on Victor and Diane's wedding reception. She left after making eye contact with Victor, then drank herself to sleep in her room at the athletic club. Deacon made several attempts to reason with her and slipped an AA inspiration card under her door, but Nikki remained determined to drink and feel sorry for herself. After another failed attempt to get Nikki to listen to him when Deacon spotted a vodka bottle sticking out from under the bed, he told Victoria and Nick about it. They confronted Nikki, and she swore that she had not been drinking.
It was Nikki's fifty-first birthday, and an argument with Victor caused her to get very drunk, to go to the AA meeting and tell off Deacon and everyone there. Deacon asked Victor to help her, so Victor tracked Nikki down, apologized, and told her he wanted to help, and that he would stand by her. They went together to her birthday party at Victoria's and told everyone that Nikki was going back to rehab, then jetted off together to the rehab facility.
When Deacon witnessed Abby Newman make a Naked Heiress video confessing that she had run down Tucker McCall at Gloworm, Deacon tipped Victor. Victor stopped the recording, but the camera mysteriously disappeared. Later Deacon sold it to Diane for $100, and she used it to try to extort money out of Victor.
In an attempt to foil Victor and escape her mounting number of enemies in Genoa City, Diane agreed to help Adam frame Victor for Diane's murder; meanwhile she would be alive and rich in Switzerland. Diane spent the next week having altercations with of them, most of them overheard by Deacon, always lurking in the background. After Diane received a message that the funds from Adam had been deposited in her Swiss bank account, she sent a text message to everyone who had threatened her to meet her at the footbridge in the park. The next morning, viewers saw those same people looking suspiciously like they had just killed someone. Meanwhile Diane's body floated face down in the stream in the park. Murphy went there to fish, discovered the dead body, and called the police. The autopsy results were that Diane had been hit over the head ten times with a blunt object, an impression of a Harvard ring was found on Diane's arm, and a small key was found in Diane's mouth. Diane, narrating "from the grave", admitted that she didn't even know who killed her.
One by one, the suspects who had received Diane's text were questioned by newly rehired detective Ronan Malloy, including Adam, Victor, Jack, Ashley, Abby, Nick, Phyllis, and Tucker. They each denied meeting Diane in the park that night while recalling to themselves that they had, and what was said. Deacon was seen by police surveillance at the crime scene the day after the crime. Deacon began alternately coming on to Phyllis and tormenting her about possibly killing Diane. Phyllis told him that after their altercation, Diane had hidden in the woods, so Phyllis had left.
Nikki arrived home from rehab to the ranch on Thanksgiving Day, 2011, as Victor was being taken to the police station for questioning in the Diane Jenkins murder. Victor later arrived home to find Nikki there, and he asked her to stay at the ranch. When asked about her absence from rehab the night of the murder, Nikki said that she had lost her sobriety that night, but had returned to rehab the next day. She let Victor believe that she was on the wagon, and he took her upstairs to make love. But Nikki was still drinking. Nikki went to an AA meeting where Deacon told her that he had seen her in the park the night of Diane's murder.
Under Victor's orders, Michael discovered that Nikki had stolen a credit card from another patient, had reserved a rental car with it, and used just enough mileage to go to and from Genoa City and Dubuque. After learning that and that Nikki had been called in for questioning in Diane's death, Victor began to suspect her. Deacon picked up Nikki from the police station, took her home and tried to reason with her, but Nikki took off for the barn with a bottle of vodka. When Victor arrived, Deacon warned him that she was drinking but was still somewhere on the grounds. Victor found Nikki in the barn, where she drunkenly confessed that she had killed Diane. Victor refused to believe her. Nikki said that she had been angry with Diane for the photos that she had published, and the alienation of affection lawsuit she had filed. Nikki confirmed that she had been in the park that night, saying that she had seen Victor and Victoria there, and each arguing with Diane. Nikki said that she had blacked out, but woke up lying in the park covered in blood next to a bloody rock. Victor promised her that he would make everything go away. Nikki then passed out, and Victor covered her with hay. When Ronan showed up with a warrant for Nikki, Victor played drunk and confessed to the crime. When Adam arrived, Victor got Adam to say that he had seen Victor murder Diane, and Victor was arrested. The DA was happy, but Ronan and Paul felt that it had been too easy, something was not right. Ronan interfered during Victor's arraignment claiming that Victor was not the murderer, which caused the judge to postpone and Ronan to be fired from the GCPD. Ronan received an email that was meant to appear to be from Diane with the missing section of video showing Nikki passed out covered in blood next to the murder weapon rock.
Nikki was drinking heavily, staggering and falling down in public. Deacon kept rescuing her, and finally told her that he had witnessed Diane's murder. That he saw Victor yell at Diane, and Victoria kill Diane with the rock due to nasty things that Diane had said about Nikki. He told her how Nikki had tried to save Diane, and had gotten covered in blood. Deacon promised Nikki that he wouldn't go to cops if Nikki would marry him. So Deacon took a drunken Nikki to Las Vegas and they were married. Deacon made sure it hit the tabloids, and Sharon had to break it to Victor. When they returned, Katherine offered Deacon twice what he would get out of Nikki to annul the marriage. Nikki tried to explain the marriage to Victor, but he dismissed her. From her actions, Nick and Victoria concluded that Nikki had killed Diane and Victor was sacrificing himself for her. When Victoria went to try to help Nikki, Nikki drunkenly told her not to worry, that she and Victor would protect Victoria for killing Diane. Shocked, Victoria swore that she had not killed Diane. Meanwhile Nick physically attacked Deacon for taking advantage of his mother at the athletic club bar.
Victor's arraignment was rescheduled, but as the judge accepted Victor's guilty plea and had sentenced him to 25 years to life, a drunken Nikki broke into the court room and confessed. Nikki was cited for contempt, arrested, and thrown in jail, and Victor was taken to prison. Deacon visited Nikki, and she called him a liar for coercing him into marriage. Deacon left, quit his job at Gloworm, and treated himself to some lavish spending before Nikki could get a chance to stop him. Victor offered to ship Deacon out of town, but Nikki wanted to deal with Deacon herself. After discovering that Deacon was tending bar at Gloworm the night of the murder, Nikki gave him a piece of her mind, and offered him a payoff to get an annulment.
On Christmas Eve, a drunken Nikki went to visit Victor in prison. Finding Sharon there with him, and Victor telling her to leave and not to come back, Nikki went to Gloworm and proceeded to drink some more vodka. Deacon tried to get her to stop, admitting that he was a jerk, but that he truly cared about her and wanted to help her. Then Nikki received a text message from Katherine to come to the church, that her daughter Victoria was about to remarry Billy. She dismissed Deacon's offer to take her or call a cab, and left for the church drunk. The next day, Nikki showed up at Gloworm, and told Deacon that she had changed her mind, and wanted to stay married, secretly hoping to find out what really happened the night of Diane's murder to free Victor.
Nikki began faking being drunk and paying bartenders to give her non-alcoholic drinks while she plied Deacon with affection for information about the night of Diane's murder. Deacon was getting suspicious, but on New Year's Eve, he gave her enough information that she excitedly went to Victor to let him know what she was doing to set him free. But Nikki walked in the visitor's room just as Victor had given Sharon an engagement ring and asked her to marry him. Nikki went to Katherine's for solace, but still refused to divulge what she was up to, only saying that she had been a fool to let Victor hurt her once again.
Deacon caught Nikki poking around in his laptop, and was about to strangle her from behind when they were interrupted by Victoria knocking at the door. Deacon never confronted Nikki, just deleted some files and password protected it. But Nikki had emailed herself a video file she had found, which turned out to be of Deacon and Diane having sex. Meanwhile Patty saw Deacon hide something behind a dumpster in the alley behind Gloworm. Nikki took the video to Paul and Ronan who had just invalidated Deacon's alibi when a customer confirmed that Deacon had left Gloworm for over an hour. Since the video was shot on super 8 film, like the video at the warehouse and the one Ronan received of Nikki passed out next to Diane, they were able to surmise that Deacon had a super 8 camera and had made all the videos. Nikki showed the video to Victor and convinced him that he was protecting the wrong person.
When Nikki caught Deacon attempting to retrieve the camera and film from where he had hidden it, Deacon kidnapped Nikki and took her to the warehouse. Claiming that he had been protecting her all along, Deacon showed Nikki a video of her killing Diane. But Ronan arrived with the police after finding the film that Deacon had hidden behind Gloworm. That film showed Nikki hitting Diane over the head with a rock in self-defense after Diane tried to stab Nikki with a syringe. Deacon was arrested for kidnapping. Ronan showed the film to the D.A. and Victor was released from prison.
Ronan subpoenaed all of the Diane Jenkins murder suspects, and he and the DA questioned them about the evidence that still did not add up. Deacon arrived in handcuffs saying that Diane had come to him when no one would help her, wanting to back out of framing Victor with Adam because of Kyle, so she asked him to videotape that night in the park. Deacon admitted that after he witnessed Nikki kill Diane in self-defense, he had hit her more times to make it look like someone bigger and stronger than Nikki had killed her, and he was the one who put Diane's body in the creek. Deacon said he had taken the syringe, Ashley's cell phone, and the security camera from the tree, and had hidden them in the alley behind Gloworm, but they had disappeared later. When no one would confess to taking Deacon's stash or the embroidered pillows, the DA arrested them all for obstruction of justice.
At Genevieve's invitation, Paul went to her mansion to interview Myrna about the strange goings-on there. But Patty heard him arrive and grabbed a bag and disappeared to her old hideout, the Newman potting shed. Paul searched Myrna's room for clues to why she had left, and took her computer. Later Paul found a photo from the park surveillance camera on it. When Paul wasn't looking, Ricky copied the hard drive to a memory stick. Paul started putting the clues together and realized that his sister Patty may have been posing as Myrna. Then Deacon identified Patty's photo as being the person who was there in the park helping him clean up after Diane's death. Patty was later captured after shooting and paralyzing Jack Abbott. When it was discovered that Patti had been the missing link in the Diane Jenkins murder, charges were dropped against all the suspects, including Nikki, once Ronan was able to convince the DA that Nikki was not responsible. Deacon remained in jail. Patty was sent to the prison hospital. Deacon was later convicted to serve seven years in prison.
Four months later, Los Angeles communications mogul, Bill Spencer jetted to Genoa City intent on getting Deacon out of prison to stop his daughter Hope from marrying Bill's son Liam. On his way, Bill perused the file on Deacon, remarking that Deacon had had "a run-in with that arrogant SOB, Victor Newman." Bill propositioned a bruised and beaten Deacon that he could get him out of prison for favors. Deacon said that he would do anything to get out and see his son, "Little D", but Bill said that if he wanted to get out, he would be seeing his daughter Hope, and that would do everything that Bill told him to do. After hearing the plan, Deacon refused. Bill barged into the warden's office and blackmailed the warden to release Deacon, or the warden's family would find out about his ongoing affair. Back at his cell, Bill told Deacon that he had arranged for his release, and convinced him to agree by showing him a photo of Hope. Meanwhile Hope was seeing her therapist, and revealing that although she never knew him, she wanted her father Deacon to walk her down the aisle at her impending wedding. Deacon was released a week later, and after further threats from Bill, they flew to Puglia, Italy to attend Hope's wedding.
Deacon showed up at Hope's room as she was about to leave in her gown for her wedding. Shocked to see her father, whom she hadn't seen since she was a child, Hope hugged him and told Deacon that she was glad that he was there. Deacon was amazed that Hope was so kind to him and didn't hate him. Deacon told her that much as he wanted to give her away, he could not attend her wedding, that as an ex-con her mother, Brooke, would never allow it. Under orders from Bill, Deacon swiped Hope's cell phone, told her to go to her wedding, and then he left.
Bill paid the limo driver to leave without Hope, but Hope hitched a ride to the church on the back of the gardener's pickup. Hope arrived too late because unable to reach her by phone, Liam had left to look for her. Liam found a note saying "I cannot go through with this." in their hotel room. Assuming it was from Hope, Liam was devastated, and when Steffy showed up, they almost made love, but Liam stopped it. Then Hope returned to the hotel and explained everything to Liam, including that the note was from Deacon to her, and she did want to marry him. After finding out that his plot had failed, Bill went to Hope and welcomed her to the family, and Hope and Liam were married on the beach in Italy with the whole town in attendance. Bill apologized and promised that he would never stand between them again. Deacon left Italy on the jet with Bill. Bill gave Deacon a handful of money and had the pilot drop Deacon off in any location with an airstrip so that Bill would not be compelled in the future to tell where Deacon was. Hope later told Liam that meeting Deacon had changed her whole perspective on life.
Back in Los Angeles, Hope and Liam discovered that their marriage had not been legal, then they split up after Hope saw a video of Steffy and Liam kissing in the hotel room after Liam thought that Hope had backed out of the wedding, and she was told that they made love.
Three months later, Deacon showed up in Los Angeles, flowers in hand, to see Hope. After hearing what had occurred since he had last seen Hope in Italy, and feeling guilty for his hand in it, Deacon went to see Bill Spencer. Deacon and Bill argued with Deacon laying out all the facts about how Bill had gotten him out of prison to help him sabotage the wedding of their children, when Katie walked in and overheard. Deacon filled in Katie, who told him to get the hell out of town and never come back. Bill implied he would have Deacon killed if he ever showed his face in town again.
Deacon returned to Los Angeles after an absence of nearly two years, proceeding to meet Quinn Fuller in a bar. It turned out Quinn was the mother of Wyatt Fuller, who, along with Liam, had been dating Hope. At Quinn's behest, Deacon visited Hope, who had forgiven him for what happened in Italy and agreed to foster a father-daughter relationship with him. Quinn offered the transient Deacon a place to stay in her jewelry warehouse if he would help her push Hope back toward Wyatt. Deacon introduced himself to Wyatt and bonded with him over a bottle of Scotch.