Nick drops hints about the photos to Peter. Taylor drugs Nick while Peter removes the pictures from his apartment. When Kyle arrives home, Taylor pretends that Nick is attacking her. Nick accuses Taylor of having an affair, but cannot produce the photographs. Kyle throws him out of the building. Nick records an illicit phone conversation between Peter and Taylor. Craig drives Amanda to Peter's house, where she sees him with Taylor. She punches out Taylor and sleeps with Craig as revenge. Josh threatens to publicly expose Megan's past unless she pays him off. He tells her to meet him at a hotel room, then tricks Michael into believing that she has returned to prostitution. Josh meets with Kimberly, who had arranged his parole. She gets him a job running AV equipment at a hospital party. He threatens to run an X-rated video of Megan unless she turns one last trick for him.

Amanda rejects Craig, who seeks a relationship after their night together. Kyle realizes that Taylor has been lying to him. He visits Nick's motel room and forces him to play the recording. Nick threatens to kill Peter unless Taylor pays him $5000. Nick attacks Peter with brass knuckles. Kyle stops Nick from killing Peter, and helps him skip town. Kyle throws Taylor out of the apartment. Josh plays Megan and Kimberly against each other. Megan is arrested for soliciting an undercover cop. Michael bails her out, but breaks up with her. Matt's brother Luke dies in a plane crash. Matt is shocked to learn that Luke named him the guardian of his teenage daughter, Chelsea.

Michael takes Megan back after learning that she has returned to the streets. A woman sues Sydney after she is injured by a display at the boutique. Kyle's plans to force Taylor from their partnership are squashed when Sydney accidentally tells Peter that she slept with Kyle. Alison is confined to bed due to complications in her pregnancy. She gets caught up on all the gossip as she overhears arguments in the courtyard. She hears Taylor tell Kyle that Peter was her brother-in-law. Although Jake feels Alison should mind her own business, he shares this detail with Amanda when she tries to blame herself for the failed marriage. Amanda has Craig drive her to Peter's house to confront the couple. She forces Peter to realize that Taylor's appearance in the apartment building was no coincidence. Matt finds it impossible to cope with Chelsea's rebellious behavior. She runs away after overhearing Matt agree to leave her with his mother.

Jake and Alison hit the road in the hopes of finding a place to get married. Their car breaks down in a small town, where they eventually tie the knot. Jake allows Alison to sample some of the champagne provided by the motel manager. Sydney rejects Harry's overtures and returns to work at Kyle's. Kyle refuses to get involved with Syd because he is not ready for a relationship. When Sydney sees Amanda making time with Kyle, she decides to participate in one of Harry's scams to take her down. Syd hurls herself down the stairs at D&D while waitressing at a party. Taylor realizes that Peter is trying to turn her into Beth, but decides to go along with it to make him happy. Kimberly appears to Megan in a dream and warns her that Michael destroys his wives. Megan backs out of Michael's scam to discredit Peter. Chelsea's mother, Denise, apologizes for leaving her; she convinces Chelsea to live with her in Europe. Reilly threatens Billy. Samantha learns that her father escaped from prison, but

Michael decides to convince Peter that he has a disease called rage epilepsy. He and Taylor drug Peter, then tell him that he struck Taylor during a blackout. Taylor fears that Peter would recognize a make-up job, so she strikes herself in the face with a door! Craig roughs up Harry to get him to stop harassing Syd. Sydney receives a settlement of $50,000 and a consultant position. She sleeps with Craig. Megan tells Kyle about Jennifer's job situation. He rescues her from the strip club and lets her stay at his apartment. Kyle and Amanda finalize their divorces in the Dominican Republic. They seem interested in each other, but Amanda is put off when she learns that Jen is staying with Kyle. Billy and Sam are questioned by the police. They continue to pay off Reilly, but he refuses to leave the country without his daughter. Jake and Alison decide to sell Shooters and buy a diner in Ojai, California. Alison realizes that Jake is not content with his life. Denise questions Matt's parental

Taylor tricks Amanda into surrendering her share of the jazz club. Megan learns that Brett cared for her during the coma, while Michael focused on his career. Lexi decides to enter the interior decorating business. She is distraught when her first job (at Field/Mancini) goes by the wayside when Brett sues Michael for stealing his invention. Lexi hits something with her car while under the influence of pills. Peter discovers blood on the bumper. Craig refuses to make a commitment to Jennifer, but she decides to accept a casual relationship. Connie takes a temporary job at Amanda Woodward Advertising. Sam is called away from her honeymoon to take a business trip, and Connie tries to create friction between Billy and her.

Taylor visits Nick in Dallas. Even after they sleep together, he is unwilling to tell her anything about Christine. She convinces him to help her break up Kyle and Amanda by telling him about the jazz club (which Nick had always dreamed of opening with Kyle), and how pathetic Kyle has become. Nick says that Christine didn't immediately die of her injuries, but convinced him to tell Kyle she was dead so that he would move on. Michael is ousted from the practice after Amber gets drunk and embarrasses him at a company function. Megan breaks up with Brett, who had provided Amber with the liquor. Michael throws Amber out, and she responds by cleaning out his house. Lexi's father continues to put down Peter and compare him to Brett. He gives Lexi a job managing one of his companies. Billy and Samantha try to convince a hot baseball prospect named Jeff Baylor to become a spokesman for one of their clients. Jennifer learns that Craig has instituted potentially deadly cost-cutting moves at the

Billy dedicates himself to making his marriage work, although he is still drawn to Jennifer. Sam is shocked by Jeff's impromptu marriage proposal. Taylor hides out at the beach house until Michael ensures that Nick has left town. Nick sends Kyle a note apologizing for Taylor's death. She laughs it off. Kyle (with Jen's help) discovers that ""Christine"" was in contact with Nick. Amanda refuses to have anything to do with Kyle. She seeks Peter's advice and creates a rift between Peter and Lexi, who have just moved into a new condo. Peter bails on a dinner with Amanda and returns home to apologize to Lexi. Brett suggests that he and Megan get away from their ex-spouses and make a fresh start. He reveals that he is in the running for a position at a research hospital in Philadelphia.

Overcome with guilt about Lexi's plight, Megan convinces Brett to marry Lexi. She is hurt to learn that they must live together with no one else in the house, especially after Lexi suddenly begins to show a romantic interest in Brett. Michael rebuffs Taylor's attempts to turn him into a responsible father, but softens after delivering a couple's baby on the side of the highway. Peter begins his pursuit of Amanda, who has remarried Kyle. The ""newlyweds"" cannot find any time together. Billy moves in with Jennifer. A furious Samantha tries to use Jeff to make Billy jealous. She demands that Amanda fire either her or Billy, but learns that the outcome would not be in her favor.