Billy and Alison cannot get Jake and Jo back together. Amanda forces Jake to work with Jo on a photo shoot, where they bicker. The Mancinis' divorce is finalized. Michael fears that Jane is stealing his friends, so he throws a party at the beach house. Jane goes drinking with Alison and Jo; then sleeps with her lawyer, Robert. Kimberly is irritated when a drunken Michael flirts with every woman at the party. Sydney passes out drunk and spends the night on Michael and Kimberly's couch. Jake tries to invite himself to Amanda's apartment, but she slaps him. Katya asks Matt to marry her so that she and her daughter Nikki won't be deported.

Jane throws Sydney out, but Amanda leases her an apartment in the building. Alison travels to a ranch to make a presentation to millionaire computer exec Steve McMillan, but it does not go as planned. Matt decides to marry Katya. Michael sleeps with Sydney while Kimberly is out of town at a conference.

Sydney gets a waitress job at Shooters. Kimberly catches Michael in bed with Sydney. She tells Jane, who rejects Sydney. Kimberly moves out when Michael refuses to leave the beach house. A drunken Michael interrupts Jane's dinner with Robert's parents. Matt gets a date, but is distracted when Katya and an ailing Nikki have to move into his apartment to fool an immigration official. Alison is jealous of Steve's relationship with Jo.

Michael learns that Kimberly has died. He is transferred to a rehab hospital, but manages to convince Jane to take him in. Robert is enraged by this development. Billy breaks up with Alison and moves in with Jake. Sydney becomes a prostitute in an attempt to pay her bills. Jo doesn't believe Syd's story about becoming a highly paid model, but Syd refuses to open up to her. Lauren threatens Sydney after Syd storms out on a client with an affinity for ""toys."" Katya leaves Nikki with Matt as she returns to Russia to care for her ailing mother.

Billy manages to sneak out of Amanda's apartment without detection. Alison asks him for a reconciliation, but he turns her down. Matt promises Nikki a Christmas party. Billy and Jake look for a tree for the courtyard, and end up running into Jo and Alison. Billy tries to fly home for Christmas, but can't get a flight. He plays Santa at Nikki's party. Alison finds him sneaking a present into her stocking during the night. They apologize and renew their relationship. A temporary nurse prompts Michael to reflect on his behavior. He apologizes to Jane and Robert. Sydney goes to confession and gives up hooking. Nikki returns to Russia.