Ben was puzzled when he didn't find any reporters around the Mariah. He asked a local if he had seen Quint, or if he had seen any reporters around. The guy told Ben that Quint had left heading toward town, and that no one had been around the Mariah all day. Ben realized he had been duped by Quint.
Ben and Meg's House
Quint informed Meg that he was the one that called Ben and told him that there were reporters snooping around the Mariah. He had made up the tale to get Meg alone, because he felt he had to warn her. Quint came right out and said that Ben killed Maria and that he had proof. When Meg asked for the proof, Quint showed her the notice in the paper about Maria being declared dead. Meg explained that it was just a formality and it didn't mean that Ben killed Maria. She wanted Quint to leave. Meg declared that as far as she is concerned Maria died in a boating accident. He said that Ben has been filling her head full of lies and asked her if she had ever seen the other side of Ben. Meg concluded that Quint was part of a set up by Annie, when Quint mentioned that Maria had written about Ben's temper in her journal. As Meg yelled she loved Ben and that would never change, Ben charged in the door and got rough with Quint. Ben's temper frightened Meg as he threw Quint out the door. Meg apologized to Ben for even letting Quint in the door, but Ben said he was the one that owed her the apology for getting rough with Quint in front of her. He's just tired of all the rumors. Meg commented that Annie must be behind Quint coming there, but Ben explained that it wasn't Annie's fault this time. Quint had never felt Ben was good enough for Maria, and when she died Quint blamed him. Meg was touched when he said he only wants to see that Meg is happy, safe, and loved. They embrace.
After some badgering from Gregory, Paula admitted that in her heart she didn't believe Ricardo was capable of raping Gabi. When the DA redirected her, Paula explained that in her professional opinion Ricardo raped Gabi.
Gabi's terrifying childhood memory continued to plague her and became clearer.
Ricardo took the stand against Gregory's advice. He told his side of the story and said the only thing he is guilty of is rotten judgement. As the DA cross-examined him, Ricardo pleaded with Gabi to admit she is lying.
The Richard's House
Cole wanted to know if Olivia is divorcing Gregory because the baby she is carrying belongs to him. Olivia lied that was the reason. Olivia was surprised when Cole asked for proof. Cole slipped up and said that Olivia couldn't tell about their affair because he didn't want Caitlin to be hurt. Olivia assumed he just forgot for a moment that Caitlin was gone like she does sometimes. Cole asked her not to ruin Caitlin's memory by revealing their affair. Olivia explained that she had to claim that the baby wasn't Gregory's or Gregory would claim her an unfit mother and take her baby. Cole realized that Olivia really didn't know who the father of her baby was. Cole stressed to her that Gregory would demand tests; and if the baby turned out be Gregory's, then their affair would be more ammunition for Gregory to use. Olivia decided that Cole was right and that she needed a way to fight Gregory without soiling Caitlin's good name.
The Bed and Breakfast
Sean tried to convince Caitlin that going back to Sunset Beach would be the wrong thing to do. He admitted to her the role he played in trying to keep Cole and her apart. She said he had only made a mistake because he had listened to Gregory. Caitlin asked Sean to keep quiet about the plan Gregory had to take her baby and tell her it was dead. Sean agreed when he realized that Cole would do something drastic if he knew. Thinking about the letter, Caitlin told Sean that she needed to leave to go to Sunset Beach. She had to get to something before Cole did. She panicked when Sean said that it might be to late then… Cole was already in Sunset Beach. Caitlin blurted out that she couldn't let Cole see the letter. Sean wanted to know what letter she was talking about.
Cole went into his apartment leaving the door wide open. The letter from Caitlin was sitting on his desk unnoticed. A mysterious woman stood in the doorway watching Cole.
The Waffle Shop
Virginia calls Vanessa's answering machine while covering for Elaine at the Waffle Shop and learns that Tyus and Vanessa are friends. She thinks aloud, "I wonder what Michael would think." At that moment Michael and Jimmy come in and overhear her. She covers her tracks by saying she was thinking about Michael's Christmas present. Later when Tyus arrives Virginia hints that he and Vanessa are both dedicated to their work and would be a great match. Virginia asks Vanessa if she isn't going to spend Christmas with her famous father, then what about her mother? Virginia starts to think the patient at Cedar Oaks may be Vanessa's mother. Vanessa confides in Alex that Virginia has gotten in the way of he relationship ever since she arrived at Sunset Beach.
Sunset Beach Courthouse
Ricardo denies raping Gabi on the stand, but does admit his poor judgement got in the way of his and Paula's relationship. Gregory later recalls Gabi to the stand and repeatedly confronts her about knowing who Ricardo was all along. Otherwise she wouldn't have all those pictures of him in her scrapbook, and having those meant she knew exactly who he was when she arrived at Sunset Beach. Gabi's testimony continues to describe the rape, how she pleaded to him not to do that because it hurt her. A crying Gabi slips in her testimony and reveals her father repeatedly raped her as a child. Casey asks his mother if her friendship with Gregory is just a friendship.
Returning to Sunset Beach
Caitlin realizes that Cole may get to her letter before she does and asks Sean to take her home. In the meantime a stranger went through Cole's room. Caitlin arrives just before Cole opens her letter.
The Police Station
Gabi horrified the courtroom with her tearful recollection of how her father raped her. She hadn't remembered the incident until that day. The case against Ricardo was dismissed when Gabi confirmed that Ricardo didn't rape her.
Even though he was a free man, Ricardo didn't feel like celebrating.
The story of Lorenzo's disgusting crime against his own daughter Gabi reminded Gregory of his own actions that resulted in the demise of his daughter, Caitlin.
Paula stressed to Ricardo that after she testified she realized he was innocent. She was so sorry she ever doubted him. Ricardo didn't know what to say. All he had ever wanted was for her to believe in him. She had even walked the fence when she testified. Ricardo admitted that he didn't know if he could forgive her or not yet. He told her to just go be with Gabi.
Ricardo was reinstated back onto the police force.
After figuring out from a bill that it is Vanessa's mother in Cedar Oaks Hospital, Virginia called Cedar Oaks and pretended to be Vanessa. Virginia hinted around trying to find out what Vanessa's mother's diagnosis was. The nurse explained she would have to speak to the doctor. Virginia said she would just come for a visit. This surprised the nurse and prompted her to ask why the change of heart when she had never come to see her mother before. Virginia explained it was time she made amends before it was too late. The nurse warned her that her mother would probably not recognize her.
Gabi felt guilty for what she did to Ricardo, but she truly hadn't remembered being raped by her father until that day. She told Mark that she couldn't face everybody. Mark reassured her that she was a victim and that she should just be true to herself. Gabi asked to be alone.
Cole was surprised to see Caitlin. When Caitlin saw her letter in his hand, she confused him by telling him not to read it. She explained that it was a goodbye letter that she had written when things were very different for them. Cole then said he didn't want to read it because all they had between them now was trust and love. That made Caitlin feel pretty rotten for lying to him. Caitlin explained that it was time for her to speak with Gregory alone.
Elaine and Cole had a joyous reunion. She was thrilled when he revealed that Caitlin was alive and that she was also pregnant.
Cole scrambled through a box searching for something. Just then the mystery woman comes up from behind him dangling a bracelet and asks if that was what he was looking for.
Casey tried to breathe some holiday spirit into the disheartened group (Michael, Vanessa, Virginia, Alex, and Jimmy). His efforts paid off when they all perked up while decorating the tree. Virginia reminisced about her mother knowing that it would just eat Vanessa up. The 'Christmas Spirit' really seemed to have arrived at Surf Central when they sang Christmas carols, even including a rap rendition by Michael.
The Richard's House
When Caitlin arrived, the house was empty. She went to the nursery and lamented that Gregory got what he wanted… she lost her baby.
Gregory came home and tried to drown his misery and guilt in a bottle of booze. A drunken Gregory heard Caitlin say 'Daddy'. He couldn't believe his eyes when he looked and saw her standing in the shadows.
Ben and Meg's House
Meg was in the festive spirit and decorated the house. She left a trail of tinsel to herself for Ben. Things had just started to get romantic when Annie came visiting with her own brand of Christmas cheer. Annie brought an old box of decorations that belonged to Ben and Maria. Annie went out the door, but hung around outside to eavesdrop. Meg found an ornament that Maria addressed to Ben on their first Christmas together. Instead of freaking out, Meg told Ben she had something to say to him. Knowing that Annie was listening in on them, Meg pulled her back in the door to hear what she was going to say. Meg declared that she wasn't looking in the past anymore and was only going to look ahead. Meg berated Annie for professing to be Ben's best friend and yet still continuing to throw his past in his face. She then threw Annie out. Meg told Ben that she loved him and trusted him, but there was one more thing she had to tell him. Mark came knocking at the door, just as Meg intended to tell Ben about the "bloody" sheets. Ben had to leave when Mark reminded him that he had to go pass out bonus checks. Mark was glad to hear that Meg was planning on coming clean with Ben. But when he found out she was planning on telling Ben that night, he advised her not to ruin Christmas like that. After Mark left, Meg tried to decide what was best to do. She went to the closet to look at the sheets again. Ben unexpectedly came in and Meg shoved the box with the sheets quickly back into place. However, she unknowingly left the door cracked open to the hidden compartment. When Ben asked Meg what she had been about to tell him earlier, Meg just told him that he was now her family and that they'd start their own traditions that night. Meg left to go open gifts at Surf Central. Ben went into the closet and realized that Meg had been in to his things when he was the door ajar. Ben seethed, "Big mistake Meg."
The Richards' House
Gregory went to go to Caitlin when he saw her, but he stumbled from drunkenness. When he looked up, she was gone. Gregory thought he had only been dreaming. As Caitlin listened from the porch, Gregory lamented about how sorry he was for what he had done to her. Caitlin decided she would just leave him to suffer a while longer before she reveals herself.
Gregory told Sean about his visions of Caitlin. Sean taunted Gregory that he was seeing Caitlin because he knew he was responsible for her death. Gregory tried to convince Sean to stay and celebrate Christmas Eve with him, but Sean once again turned Gregory down. Tim caught the tale end of Sean and Gregory's conversation and became concerned about Gregory.
Cole was surprised to see his old partner in crime and lover, Jade. Jade was expecting more of a reunion and was disappointed when Cole just kissed her on the forehead. Jade didn't understand what he was still doing in Sunset Beach. He wasn't exactly living in the lap of luxury. Jade wasn't happy that Cole had been to Monte Carlo and hadn't even looked her up. She assumed he was running the romance the rich man's daughter scam. When Caitlin knocked on the door, Jade hid in the closet.
Caitlin explained to Cole that she decided to tell Olivia first. Cole worried about the stress on Caitlin considering her condition. Jade, who was listening in, was surprised to learn that Cole was about to become a father. Caitlin claimed nothing could keep her from facing her parents. After Caitlin left, Jade joked with Cole about his oncoming fatherhood and assumed it was all part of his scam.
Bette and Annie's House
Olivia wasn't happy that Bette and Eddie were readying the house for Christmas. She couldn't help but to remember how Caitlin wished that Gregory and she would just be happy. She told Bette that Gregory was probably thinking the same thing. Alex walked in and overheard. She encouraged Olivia to go to Gregory, but Olivia explained that wasn't a good idea.
Tim came looking to talk to Olivia about Gregory, but Annie intercepted him at the door. When she found out what he was there for, she suggested that it would be better for her to talk with Olivia woman-to-woman.
Bette realized Annie was up to no good when Annie left.
Bette and Eddie excitedly changed Christmas presents. They both got each other a pair of binoculars.
Olivia lamented to Bette that she would just have to get used to Christmas without Gregory, Sean, and Caitlin. Later on, Caitlin came walking through the door. Olivia was so shocked that she fainted.
The Richards' House
Alex comforted a grieving Gregory. Annie witnessed Alex and Gregory embrace to her dismay.
Ben and Meg's House
Ben was devastated to discover that Meg had been snooping around behind his back. He recalled how Meg had been frightened when she came out of the closet on the night they made love. He wondered why she had to go and ruin everything.
Jade was having a hard time buying Cole's claim that he was in love with Caitlin. She asked why he could just throw away what they had. He said that they were in the past. Cole made Jade leave when he left.
Annie and Bette's House
Olivia was elated that Caitlin was alive. Caitlin explained that Cole was the only one that believed in her and was the reason that she was alive. Olivia stressed that she never wanted to believe that Caitlin was dead, but the paramedics had told her there was no way that Caitlin was alive. Caitlin berated Olivia for Gregory and Olivia's treatment of Cole after the accident. Olivia said that Gregory had been looking for someone to blame, and she was too scared to stand up to him. Caitlin kept up the pretense that she was still pregnant. Olivia assumed that Caitlin must hate her since she never contacted her to let her know she was okay. Caitlin asked Olivia what Olivia thought she had done to her. Olivia explained that had let her take her to the clinic when she should have stressed that Caitlin should stay at home with Cole. After Caitlin questioned Olivia about what she remembered before they went off the cliff, Olivia admitted that she was ashamed that she tried to break them up but said that was all she did. Caitlin remembered hearing how Olivia was involved in Gregory's plan. Caitlin came back to Sunset Beach to realize her dreams. Olivia reminded Caitlin that she was living her dream. Caitlin didn't understand why Olivia was divorcing Gregory. Olivia said that there were things that Caitlin wasn't aware of that could destroy everything. Cole came in. Olivia gave Cole her gratitude for bringing Caitlin back. After being prompted, Olivia also apologized for trying to keep them apart. When Caitlin left to get some water, Olivia took the opportunity to slap Cole. She seethed because he watched her grieve and didn't say anything. Olivia suggested to Caitlin that she reveal herself to Gregory. Olivia would go with her.
The party was in full swing and everyone exchanged gifts, but Gabi. When Gabi finally wandered in; Mark tried to convince her to join them, but she didn't feel she could face everyone. Mark suggested that she get counseling or at least talk to him. Gabi said there was nothing left to say. She felt she had made a mistake by coming back to Surf Central and left.
Vanessa never answered when Virginia asked Vanessa about seeing her mother during the holidays.
The Richard's House
Annie declared war when she witnessed Gregory and Alex embracing. She interrupted them and said she was there to spread holiday cheer. A drunken Gregory slurred the more the merrier. When Gregory went to the wine cellar, Annie decided to make a phone call. She called Casey and asked him to bring her some business papers as Gregory wanted to work. Alex asked Annie what she was up to. Annie said she could ask her the same thing. Alex claimed that Gregory and she were only friends. Alex realized that Annie was messing with her when Casey showed up. After Annie took the papers, she strongly suggested that Alex and Casey get lost. When Gregory came back, Casey could tell how drunk he was. Casey stated that Gregory had had enough to drink, which Gregory didn't take to kindly to. Casey warned Gregory that he wouldn't let him take advantage of his mother's good nature. Alex said it was time for them to go and wished Gregory well. All alone, Annie tried to convince Gregory that they are two of a kind. When Annie kissed Gregory, he didn't back down at first. The two were sprawled out on the couch before he finally pushes her away. When he looked up, he received the shock of his life. Caitlin was standing in the doorway with Olivia… this time it wasn't a dream.
Ben recalled the different events that led up to that moment. He knew that even though she told him earlier that she completely loved and trusted him that it couldn't be so since they were both hiding something from each other. He mentioned that Meg should have listened to Ricardo's warnings about him while she still had the chance.
Ricardo and Meg took care of business. He said that the holidays hadn't been the same since Maria died. Meg was startled to see Ben looking in the door. Ben explained he was just anxious to get her home. They wished Ricardo a Merry Christmas and left. Outside, Meg said she didn't understand the hurry. She assumed he had a surprise for her and he said it was something like that.
Jade greeted Cole in nothing but a negligee.
Gabi was sitting on the beach when Ricardo walked out onto it. The two notice each other and just stare.
Ben and Meg's House
Ben told Meg that her surprise was in the closet. When she hesitated, he forced her into the closet. Ben pulled the box with the "bloody" sheets and scissors out of the compartment and threw it down on a table. He demanded to know just how long she's known.