Dr. Thompson's Office:
Diane goes to see Dr. Thompson. They discuss her new life in Milan but Diane declines to comment on the current circumstances with Kyle's biological father. Dr. Thompson is paged and leaves the office to see a patient. Diane uses this time to sneak a peek at Phyllis' file and finds out that Phyllis cannot have children. She realizes that Jack's paternity of Kyle really does change everything for all involved.
Phyllis comes to Jack's office content in the assurance that Diane should be well on her way to Milan by now. Phyllis tells Jack that they can't go on like they have been; something has to change. She tells Jack that she is considering the merit of her and Jack raising Kyle together.
Victor is still at Julia's. He has decided to help concerning the take-over of her company. After some reminiscing, Julia flashes back to a pleasant Christmas memory from years gone by (circa 1980). Julia comments that she doesn't think Victor is the kind of person that could work side by side with his wife in business. Victor decides that he will have to stay in town to deal with Julia's business matter. He calls Nikki to cancel their dinner plans.
The Jabot Boardroom:
Ashley tells Brad about Jack's paternity of Diane's child. Ashley also expresses her concern about Phyllis. Ashley threatens to help Phyllis get rid of Diane, but Brad cautions her to slow down before rushing to action. Later Jack and Phyllis come in and announce that they have worked things out. Phyllis tells Ashley not to be concerned at her earlier actions, as she was simply feeling strained.
Nick and Cassie attend a father-daughter dance at school. Cassie's friends ask Nick if he will dance with them too. After the dance, Cassie indicates that it is mommy's fault that daddy can't come home. Nick tells Cassie that it isn't Sharon's fault and asks her to be nicer to her mom.
Raul comes to the coffee shop looking for Brittany. Diego arrives late to work. When he arrives his forehead is bleeding. Diego informs Sharon and Raul that there was a scuffle at the rooming house where he lives, and that he had to do something. Sharon insists that he go to the emergency room. Raul goes along. When they return later, Diego has one stitch. Sharon comments that Diego's living arrangements seem a little sketchy. Diego replies that he doesn't have many options. Later over coffee, Raul tells Diego that it is time for him to leave Genoa City. At another table, Sharon's mom mentions that they are all lucky to have Diego there.
Katherine visits Nikki at the ranch. She tells Nikki that she is distracted by Mackenzie's heartache over her break-up with Billy. Nikki tells Katherine of the growing relationship between her and Victor, and of the dinner planned that evening at the Private Dining Room. Subsequently, Victor calls and cancels dinner saying that he has to go out of town on business, and that he will call when he gets back. Nikki is frustrated both at Victor's cancellation and of her own growing feelings for him. Katherine assures her that Victor is a hands-on businessman, that this is to be expected, and that his personally calling to cancel dinner is a good sign that things are well.
Neil and Isaac discuss how when the search helicopters return they will have covered every possible location where Malcolm could be. Alex overhears and blasts them for giving up. She won't, ever! Isaac assures Neil that what happened to Malcolm was an accident. Neil understands why she needs to lash out. Isaac mentions that before the accident Isaac asked about the injuries to Malcolm's hands. Alex thinks he's trying t look for a reason other than him for Malcolm's death. Nothing else could have set him off other than Neil. She flashes back to her last talk with Mal and realizes that they did have an argument about Neil. She didn't think much of it then but sees that Mal was upset that she wasn't more frustrated regarding her situation with Neil.
Brad and Ashley discuss Phyllis and Jack's current problems. They bump into Nate and Olivia. Nate is looking forward to Malcolm's homecoming tomorrow. Olivia mentions how she hasn't heard from Malcolm in weeks. She's tried several times to contact Mal but to no avail. They haven't even heard from Neil. Ash and Brad think that's strange. Ash encourages her to try again.
Nikki, depressed over her canceled dinner plans with Vic does some work. Victoria returns home. Nikki is happy to see her and asks about Malcolm. They still haven't found him and worries that Neil will blame himself for his brother's death. Victoria refuses to give up hope. She's not sure how much longer she can go without telling Olivia and Nate. Nikki thinks it's up to Neil to make that call. Nikki tells Victoria not to get her hopes up too high about her and her father reuniting too much. They've both changed a lot. After everything Victoria went through this past year she realized that they all must reevaluate their priorities. Nikki understands but doesn't' want to get ahead of herself.
Vic makes reservations at a hotel. Julia returns with the papers Vic asked for. He asks her to dinner and she gratefully accepts. She jokes that he isn't as controlling as he was when they were married. She was so young and he was older and set in his ways. She asks about his kids and she expresses her sympathy over Ryan's death and Nick's marital problems. She asks about his love life. She asks about Nikki and how much she liked her. When asked about anyone close to him now he remains quiet. Later she thanks him for his surprise visit and plans to see him tomorrow. She almost asks him something but changes her mind. Afterwards Vic stares at the ring he bought for Nikki.
Raul suggests to his brother to leave town. Raul thinks Diego has stayed in town for him and doesn't want his brother staying in a risky part of town just to keep an eye on him. Diego assures him that his injury was a fluke. He has wondered if he should stay in town as he does have some loose ends in California. He reveals to Raul that he and his girlfriend broke up. She dumped him because he wasn't ready to commit after he lost his job. He's still hung up on her. Raul asks if Diego is ready to settle down now. He encourages his big brother to make the first move and contact her. Diego calls looking for Carol but when a guy answers he just hangs up.
Cassie and Nick return after the dance. They had a great time. Cassie asks to be alone with her mom. She apologizes to Sharon for being mean to her. She won't blame Sharon anymore. Cassie explains that Nick explained everything to her. Sharon later thanks Nick for clearing things up with Cassie. It means a lot to her. Later Cassie suggests that they should hire Diego to replace their ranch hand that's leaving. Nick will clear it with Nikki but thinks it's a good idea Nick runs it by Diego. He's very interested. Raul is happy his brother might be staying after all.
Paul & Isabella's:
Paul returns home with flowers to apologize for not being at the doctor's office as planned. She shows him the sonogram of their baby. He's very touched.