Jack, Olivia, and Erica nervously pace the hospital floor as they wait for news on Shelly's condition. Eric has not been able to see or speak to Shelly since she suddenly lost consciousness. A nurse appears and calmly explains that Shelly suffered a seizure. Although she and the baby are not in danger, Shelly is still not ready to talk to Eric. Frustrated that he can't see the mother of his child and still conflicted over his feeling towards Jack, Eric storms out of the hospital. For her part, Olivia tries to comfort Jack, but being in the hospital is a difficult experience for her as well. While consoling Jack she has a flashback to the last time she was in the hospital, when her son Jordan died.
At the art gallery, two rough looking men show up and begin questioning Maryellen about John's whereabouts. They claim they are friends of John's but Maryellen is suspicious. She tells them John left Cedar Cove and that she doesn't know where he is. As another customer walks into the gallery, the two men make a hasty exit. As they leave, they thank Maryellen by name. Since she had never introduced herself, Maryellen is now convinced the two men are up to no good. As they leave, she jots down number of license plate.
Meanwhile, in court, the prosecutor investigating the mysterious restaurant fire announces that she is dropping charges, forcing an angry judge to dismiss the case against Warren. While the fire showed Warren's true colors, it has left Seth and Justine with a burnt out shell of a restaurant. Despite the town's financial support, the damage is quite extensive. And, while the contractor assures Seth and Justine that their insurance will cover the majority of the damages, the magnitude of the disaster is still shocking to the young couple.
Back at the hospital, Shelly has a nurse bring Olivia to her room. Heartened at Shelly's improving condition, Olivia is caught off guard when Shelly says that she wants to put the baby up for adoption. Her doubts about Eric's ability to be a father, coupled with doubts about her own ability to parent, have convinced her that the best course is adoption. Olivia pleads with Shelly to talk with Eric before making any decisions, but in the end, Olivia promises to help Shelly no matter what her decision.
For Eric, being shut out from Shelly's conversations is maddening. While Eric looks to his father for support, Jack does everything he can to keep his son's emotions in check. The stress of the situation pushes the two men farther apart and has Jack in turmoil. Sitting outside of the hospital, Jack confides to Bob that he is tempted to start drinking.
While Jack is outside gathering his thoughts, Eric takes the opportunity to sneak into Shelly's room. Eric confronts Shelly over her plans to put their baby up for adoption. Shelly points out that Eric's erratic behavior and her own childhood experiences have convinced her that adoption is the best course. Eric begs her to be reasonable, but Shelly has made up her mind. Angry, Eric storms off again.
Needing her own break from the drama at the hospital, Olivia stops at the courthouse to gather a few files. As she prepares to leave Justine arrives, needing some motherly advice. Justine confides that she and Seth are going to move forward and rebuild the restaurant. Sensing that her daughter is unsure, Olivia offers to give Justine and Seth the money to repair the restaurant. But she also presses Justine to confront her own feelings about the restaurant and about Seth.
With her mother's words still ringing in her ears, Justine goes to meet Seth at the Captain's Galley. As she walks into the restaurant, she overhears Seth talking to Derek about a business opportunity. Derek got financing for two fishing boats and wants Seth to captain one of them. Derek sweetens the deal, offering him a partnership, salary, and a percentage of the profits. Seth begrudgingly rejects the offer, saying Justine is worth giving up his dream for. At that point Justine walks up to Derek and Seth, pretending to be unaware of what they were discussing.
As the sun sets on Cedar Cove, a pall hangs over Grace's home. After her earlier run in at the gallery, Maryellen elicited Roy's help to learn more about the mysterious men who are searching for John. Sensing something is wrong, Grace resolves to wait for Maryellen to tell her what happened. But when Roy and Sherriff Davis arrive at her door, Maryellen has no choice but to reveal what transpired at the gallery.
Meanwhile, at the hospital, Eric confronts Jack and Olivia. After his argument with Shelly, Eric is more determined than ever to keep the baby. He promises to stop anyone from giving away his baby. Before storming off, he says that he has decided to get a lawyer and assert his rights. Jack runs after him, leaving Olivia standing in the hall.