A frantic Sarah showed up at Stephanie's place, wanting to talk. Stephanie tried to stop her because Alex was in the next room, but Sarah began speaking anyway. Just as she said, "We have a massive problem," Alex walked out of the bedroom and asked what the problem was.
Sarah lied and said she was just talking about the hospital fundraiser, so it wasn't anything that Alex needed to concern himself with. After Alex left for the Kiriakis mansion, Sarah told Stephanie that Xander overheard a conversation between Stephanie and Philip and now believed they were having an affair.
"I told him to keep his suspicions to himself, but I don't think he's going to," Sarah admitted. Stephanie began to freak out, but Sarah tried to make light of the situation. At least Xander didn't know about the forged letter, right? That was all that mattered to Sarah.
Stephanie couldn't believe that Sarah wanted her to go along with this misunderstanding so that Xander wouldn't learn that Sarah had been lying to him. "Listen Sarah, you and Xander, you have made it through far worse than this. Your marriage will survive. But if Xander tells Alex that I'm cheating on him with Philip behind his back, my relationship is over," Stephanie declared.
"My love life has been one train wreck after another. I am finally in a relationship that is working, but it will be over in a heartbeat if he thinks that I am cheating on him with my ex," Stephanie further explained.
Stephanie looked at Sarah in horror when she said, "You could just let Alex believe it." Sarah frantically begged Stephanie to continue lying to everyone about Philip for Xander's sake. She was so happy to see Xander and Philip getting along and knew that if the truth about the letter came out, there would be hell to pay.
"So, you want me to lie to Alex and destroy what we have when this whole forged letter doesn't have anything to do with me? It only became my problem when I heard Philip talking about it, and it became your problem when you chose to lie to your husband," Stephanie reasoned.
Philip was tickled pink reading the Spectator story on all the chaos Kristen and EJ have caused at DiMera Enterprises. He was sure that Wei Shin would be fascinated by this news and help Titan acquire DiMera even faster. Philip relayed his thoughts to a distracted Xander, who didn't seem to care. Instead, he shocked Philip by accusing him of sleeping with Stephanie behind Alex's back.
Philip didn't exactly deny the false accusation, but Xander also wouldn't let him get a word in edgewise. "I understand that the two of you have unfinished business, but she's with Alex now, and the three of us are in the middle of a very complicated takeover attempt. The last thing I need is you two coming to blows 'cause you're in love with the same woman," Xander said.
Philip finally began defending himself. "Xander, what you overheard was not what you think," Philip started. "So, let me get this straight, you're not having sex with Stephanie Johnson?" Xander asked just as Alex walked into the living room.
Alex slowly approached Philip and looked him in the eye. "You're sleeping with Stephanie?" he asked. Philip stammered over his answer, so Xander spoke up. "Alex, I'm so sorry, but yes, it's true," he said. Alex immediately grabbed Philip and tried to choke him. Xander broke things up in time for Alex to announce he was done working for Titan already.
Alex stormed out of the mansion as Xander warned Philip to end his relationship with Stephanie immediately.
Back at Stephanie's place, Sarah left when Alex returned. Stephanie tried to make light of things, saying, "You're off work early today. I'm surprised that one of your cousins is letting you play hooky," she joked. "I'm more interested in what one of my cousins is letting you play with," Alex said. "Look me in the eye and tell me you are not sleeping with Philip," he added.
Stephanie flashed back to her conversation with Sarah earlier in the episode before speaking. "Philip and I have been keeping a secret, Alex, but it's not what you think," she said.
An angry Holly surprised Doug III when she told him who told Julie about the necklace. "It was Tate. My freakin' boyfriend ratted you out," she said in frustration. Ever the valiant guy, Doug didn't blame Tate. "I'm the one who took Julie's necklace. I'm the one who stole from her," he said.
Holly didn't care because the necklace was none of Tate's business. "Tattling on you like a two-year-old? Who does that?" she asked. Doug reminded Holly that he was the one who told Tate, so he had to bear the responsibility for what happened. Doug got Holly to let the subject go for a bit, but was grateful when Holly said she still didn't think Maggie would object to giving him a place to stay.
Holly then left to see Tate while Doug took a walk through Horton Square while looking for a job. That's where he ran into Sophia, who introduced herself and her baby by revealing her bump. "I've heard a lot about you from Tate," she said, while letting Doug know she was aware he stole "a grieving woman's necklace."
Sophia said she also knew that Holly had to be ticked at Tate for telling Julie the truth, "which could give you an opening." Doug already had Sophia's number. "It looks like you're the one looking for an opening...You think that Holly's going to break up with Tate over this and Tate's just going to come running back to you," Doug said, accusing Sophia of playing the long game.
After Tate left a voicemail for Johnny, telling him he felt bad about the adoption falling through, he opened the door to find JJ there on official police business. JJ had some questions about the diamond necklace. Tate was surprised to hear that Julie went to the police with the news.
"It's a diamond necklace, Tate. It's worth a lot of money," JJ pointed out. JJ informed Tate that he would have to make an official statement. Doug could even be arrested if Julie chose to press charges. Tate was alarmed to hear that Julie had kicked Doug out of the house.
After JJ left, Holly showed up. Tate was happy to see her until she started ranting about him ratting out Doug. "You wanna tell me why you did it? Why the hell you told Julie that Doug stole her necklace?" Tate claimed that he only told Julie the truth for Holly's sake.
"I was afraid that you'd get arrested and it would mess up your whole future," he explained, but Holly wasn't buying it. She accused him of doing it to hurt Doug. Holly bragged that Tate had paid off all his debts, so everything was good now. That's when Tate realized that Holly had given him the money.
Holly accused Tate of being jealous. "This goes back to New Year's Eve. You hated the fact that Doug and I watched the ball drop together," she shouted. Nothing Tate could say would calm Holly. She was infuriated that Tate knew he ratted out Doug and didn't say a word to her about it when she was with him the night before.
Tate was flabbergasted when Holly insinuated that Doug's relationship with Julie was over because of him. "Holly, I'm not the one who stole the necklace," he said. Holly still didn't believe it was Tate's truth to tell. Before the conversation was through, Holly told Tate they were over.
Melinda alarmed Gabi when she told her that the Spectator story meant trouble for the company, including ownership of Gabi Chic. Too many vendors already wanted to get out of their contracts, so Melinda had PR doing crisis management, but it could be a case of too little, too late.
"I just got Gabi Chic back. I don't want to lose it again because the DiMeras are a bunch of amoral losers," Gabi cried. JJ soon walked in, so Gabi calmed down, but Melinda's blood pressure rose when JJ said he was there to see her and not Gabi. Melinda knew it was about the necklace. She was shocked to hear Doug had confessed but accidentally let it slip that Holly knew Doug stole it.
JJ asked Melinda to hand over the necklace, but she refused. She didn't have it anymore because she had sold it. However, she refused to say who she sold it to.
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