Val tells Ben about sleeping with Gary. Ben is upset and leaves. Karen's still upset over Diana and is having back pains. Mac convinces her to go to the Doctor, and she gets pain pills. Gary finds out that the Ciji look-alike is Cathy Geary, and he follows her. Abby tells Westmont that she is going to develop Lotus Point, and buys the apartment's management, H & O Management so she can continue to send Karen checks, and Karen will never know. Laura gets Westmont drunk to see what Abby's up to, and he tells her about H & O. Gary receives his inheritance. Diana gives a deposition that Chip 'accidentally' killed Ciji, but then he wakes up from the coma. The police handcuff him to the bed. The police decide to move Chip to County Hospital, but when they go to his room to get him, he's gone.

Gary finds out that Cathy was in prison for 2nd-degree murder. He asks Abby about it. Abby tells Cathy to leave and threatens to tell her ex-husband Ray where she is. Cathy counters that if she does, she'll tell Gary that Abby hired her to distract him so she could steal him blind. Abby calls Ray. Greg breaks a date with Abby and sleeps with Laura. Mac goes to the DA who tells him that he might be disbarred. Mac goes to the Apaloon address and finds out it's a mail service. Some guys beat him up. Ben tells Val he is taking a job in South America, and Val doesn't want him to. They hug. Michael, Eric and Gary talk to Diana about making up with Karen. Finally, Diana and Karen make up. Mac has Eric drop off a bright orange mailer for Apaloon at the mail service, and then watches to see who picks it up. He sees Laura go in and come out with the bright orange mailer.

Ben comes home and Val cries with joy. The hitman actually shot Ray, not Gary. Cathy calls Ray's mom to tell her, and Laura overhears. Laura tells Greg, who asks Karen why none of the Ewings came to Gary's funeral, and tells St. Claire that he thinks Gary is still alive. Abby mourns for Gary. Greg tells Abby to sell Lotus Point to Wolfbridge, but she won't. Greg tells St. Claire that he is through dealing with him, and calls Abby to tell her Gary's alive. Ben figures out what Mac is doing, and is furious with him because Val could have lost her babies. Ben punches Mac. Abby goes to the MacKenzies and tells Karen that Gary's alive and Mac is using him to get to Wolfbridge. Karen feels very betrayed and confronts Mac. She's upset at all the pain he has caused and tells him their marriage is over, and gives him her wedding ring back.

Karen and Mac talk but she doesn't tell him she's dying. Scott Easton calls Abby and says he has negotiated Lotus Point's water rights with Paul Galveston, and to expect a bonus within the next few days as a ""thank you"". Ben is away on a story. Val has pains all day, and Dr. Ackerman tells her to take more pills. Home alone, she goes into labor. Michael and Eric take her to the hospital. They call Gary, who immediately leaves, angering Abby. Ackerman tells Val he's going to put her under anesthesia. She protests but he says there are complications. Everything goes fuzzy for Val. She gives birth, sees the babies, and hears them cry. She hears the nurse say that the babies are healthy. Val wakes up, and Ackerman tells her that the babies were stillborn. Val insists that she saw and heard them, but Ackerman says her mind was playing tricks on her because she was under sedation. Gary calls Abby to tell her that the babies are dead. Abby is genuinely concerned. Then Abby receives a call fro

Abby continues to search for Easton. Abby goes to see Dr. Ackerman to ask where the babies are. Ackerman tells her she is sick. She tells him that Easton is dead. Cathy and Joshua make love again. Gary has lunch with Paul Galveston. He and Galveston hit it off and Galveston gives Gary his prize horse. Tom Jessick tells Mac that Gary Loader was a policeman who was framed because he knew too much about the ""Tidal Basin"" murders. One of the victims was Lila Maxwell, a secretary at Galveston Industries. Mac notices Karen isn't using her right hand, so she tells him it is sprained. Karen decides to get a second opinion, and the doctor tells her she needs the operation or she will die. Ben is concerned about Val's mental health. Joshua finds Val having a conversation with someone about her babies, only no one else is there. Val has a nightmare and wakes up screaming. Val overhears Ben and Lilimae deciding to get help for her, so the next morning she packs and calls a cab.

Gary wants to shut down construction on Empire Valley until he can talk to Galveston. Galveston men try to placate Gary. A Minister marries a mystery woman and Galveston, who is on life support. Val cuts her hand at Empire Valley, so Ben takes her to the clinic in the town of Wesphall. Ben talks to the doctor and patients, who tell him that industrial chemicals from Galveston Industries got into the ground water and caused an epidemic, but that Galveston bought everybody out and paid medical bills. They say that one woman came to town and claimed that Galveston did it deliberately to drive them off of their property. Ben and Mac show them a picture of Lila Maxwell, and they identify her as the woman. Mac finds Jamison, who said that Galveston ordered the murder of Lila Maxwell. Val remembers going in to labor, and tells Karen that she ""knows"" the babies are alive. Karen asks Mac to consider the possibility of Val's babies being alive.

Greg keeps trying to call Laura, who hangs up on him. He follows her and explains that it was a stunt Ruth set up, so he kicked her out. Greg asks Laura to marry him, but she says she's already married. The police question Karen about Ackerman, while Mac goes to his office and finds Val's file. He sets the alarm off, and is arrested. After Mac is out, they find a list in the file that has the name couples who illegally adopted babies, but there are no addresses on the list. One name on the list - Harry Fisher - rings a bell. The next day at work Karen tells Gary the babies are alive. Mac remembers that he and Ben were at the Fisher's house, and they had twins. Mac calls Karen and tells her to meet him there. Gary goes with her. Harry Fisher rushes home and tells his wife Sheila to pack, that they have to leave on a vacation now. Sheila says she won't leave because she hasn't picked up the prescription for the twin's ear infections. Frustrated, Harry takes one of the twins and goes to p

News of Gary and Jill's affair hits the papers. Abby's furious, and has a little talk with Peter. At a debate, Peter makes it clear that Gary's personal life is not an issue. Gary and Jill resume their affair. Greg has Phil's license plate traced to an address in Dillon, CA, and drives there. Jean keeps trying to call Ben, and he keeps hanging up on her. Karen escapes the burning house. Phil sees her on the road and tries to run her down. She escapes into the woods and eventually comes across a vacant house. She breaks in, but Phil finds her. She throws a bucket of ammonia in his face and runs out back to the barn. He is breaking down the barn door when Greg shows up and stops him. Greg says he'll let him go for old times sake, as long as he goes back east and never gets involved in their lives again. Karen is confused when she hears 2 cars leave. Police tell Mac they received a tip about where Karen is. Mac and Karen run into each other's arms, and he brings her home.

Laura returns home and tells Greg she left the boys with Richard. Jill's angry that Gary doesn't think Abby killed Peter, and she tells him to stay out of the investigation.Out on bail, Olivia tells Gary that Abby killed Peter because of her. Gary laughs with relief, because he knows that Olivia didn't kill him. Gary calls and tells Abby, who then sits down with Olivia to talk. They explain how they each thought the other had killed Peter, and laugh and cry and hug. They go to the police and tell the truth. Paige continues having nightmares, and Mack asks her about her friendly phone messages to Peter. He asks her to tell him everything that happened at her last meeting with Peter.