JJ shows up at Milltown, saying that Julia was crying and begs Jack to come home right away. Julia arrives and Jack breaks the news to JJ that hes going to live with his first family - but assures the boy that hell always love and care for JJ. Carly reveals to Holden that Jack has chosen her. Holden offers to have a celebratory dinner for Jack and Carly but also warns that Julia will forever be a part of Jacks life. Carly hopes that Julia will leave town, but Julia has decided to stick around for JJs sake. Holden is proud when Aaron walks into Als Diner. Later, unbeknownst to Aaron, Alison gets the manager to give Aaron a job as the cashier and Aaron reluctantly agrees to take it. A sick and confused Emily continues to be manipulated by Barbara. Meanwhile, Will wakes up after a nightmare in which Rosanna accuses him of haunting her and threatens to send him off to the loony bin. Paul tries to comfort Will and Rosanna feels badly. Later, Rosanna assures Paul that she doesnt fear Will. Meanwhile, Hal tries to reassure Will that he wont be sent back to the mental hospital. Later, Rosanna finds Cabots Christmas stocking hanging over the fireplace. Its evident that Rosanna thinks Will is responsible, just as a drugged Emily returns home and reports to Barbara her activities at Fairwinds. At Lucindas, Mike questions Katie about not wearing her wedding ring. Katie claims that Simon is buying her a new and improved one. Mike explains that hes not modeling anymore and remarks to Katie that he is a different person now. Later, Mike reveals to Jennifer hell continue to model for Street Jeans but Jennifer senses his change of heart has something to do with Katie.