Walter tells Ella and Astrid a story. It's a detective story in which Olivia, who's a detective, is hired to investigate the disappearance of Peter Bishop. Helped by Astrid aka Esther, Olivia fights both Nina Sharp and September aka Gemini to get to the truth. Olivia teams up with Peter to reach a happy ending.
While Walter deals with some very upsetting news, he tells Olivia's niece, Ella, a fairy tale that includes musical performances by Olivia and Agent Broyles.
Walter has just smoked a drug that he calls "Brown Betty" when Olivia arrives at the laboratory to leave Ella with Astrid. The girl asks Walter to tell a story and he creates a detective story where the Fringe Division are the characters.
- Walter (John Noble) gets high in his office (bong preferred). He goes on a labeling spree and is busted by Astrid (Jasika Nicole). He's stoked about his hybrid pot, which he calls "Brown Betty."
He's labeling as a way of getting control of his life. Astrid reassures him Peter (Joshua Jackson) will come back.
Olivia (Anna Torv) comes with no news, but with niece Ella (Lily Pilblad) in tow. She asks Astrid to babysit.
Cut to a while later, Ella is frustrated with Walter's poor efforts at playing Operation. She wraps up Walter's behavior: "All you've done is eat all my snacks and talk about weird stuff. And everything makes you laugh."
She suggests Walter tell her a story. He remembers his mom telling her Dashiell Hammett and Raymond Chandler stories.
Thus begins a story of O. Dunham, private investigator. We fade to 1940s hard boiled detective caper, with Olivia as a lady PI who, Walter tells us, can't mend her broken heart. She looks at a picture of her former love, Agent John Scott (the picture is an uncredited cameo of Human Target (2010) star Mark Valley).
Rachel (Olivia's sister) comes in, saying her boyfriend is missing. Walter breaks the mood by bursting into song, Tears for Fears "Head over Heels."
He explains to Ella the "medication" he's on messes up his singing voice.
Back to the noir... Rachel (Ari Graynor) says her boyfriend's name is Peter Bishop. (Ella clarifies her mom doesn't love Peter.)
Walter says Olivia took the case to see if real love existed. He warns that this is where the story gets scary.
On the other side of town, in Noir Ville, Walter tells us Peter had gone into hiding because he had in his possession a very special heart. We see a glass beating heart in a suit case.
Walter sets the scene with some jazz and back in Noir Ville we see Broyles (Lance Reddick) crooning a mournful tune. He's a cop who Olivia saw plant evidence six years ago to get a promotion. She wants a favor.
She tells him about Peter and gives him a drawing that he recognizes as the logo of Massive Dynamic. Walter describes it as "a vile firm that never missed an opportunity to exploit the little guy."
Olivia visits Nina Sharp (Blair Brown), who says Peter is a con man. She thinks Peter is using Rachel and warns her that he's dangerous.
When Olivia leaves Nina calls someone, saying there's been a development.
Olivia calls Rachel to leave a message (they have cell phones in Noir Ville) and Rachel picks up, obviously in distress and screaming for help.
Olivia arrives at Rachel's place to see her dead, a hole in her chest.
Ella is a little disturbed Walter has killed her mom, but mostly because she thinks people in love can't die in stories.
Back in the story, Broyles says they found no fingerprints. He warns Olivia off the case. She agrees, but grabs Rachel's planner on the way out. She finds a check inside with Walter's name on it.
Walter tells Noir Olivia he hired Rachel to hire Olivia to find Peter because he knew she only took cases involving lost love. Walter says Peter was his lab assistant. Walter's in a motorized wheelchair (and Gene the cow has polka dot spots).
He tells Olivia about some of his inventions: bubble gum, flannel pajamas, rainbows and singing corpses. The bodies on slabs behind him suddenly rise up, singing "The Candyman" from Willy Wonka.
He also invented the glass heart. He opens up a metal panel in his chest and explains someone stole the heart while he slept and he's only got a bit longer with batteries. The heart and Peter disappeared at the same time.
It's time for Olivia to rehire her assistant (Astrid), Esther Figglesworth. She's in a job interview and briefly breaks into quite lovely song, pleading for work. Then Olivia calls and while she's getting into her car, she's jumped from behind by a shadowy figure. The Observer (Michael Cerveris), attacks Olivia from behind and warns her to drop what she's investigating. He takes out a fancy scalpel and cuts her chest, saying not to stick her heart where it doesn't belong.
Back in her office, Astrid patches Olivia up but as she does, the wound starts healing. They think it was the weapon used to kill Rachel.
Olivia draws a sketch and goes to the patent office, where Brandon (Ryan McDonald), the Head Geek who works at Massive Dynamic in the real world tells her it was patented by MD.
Olivia busts into Nina's office. It's called the quantum laser and was stolen several months ago. Nina guesses a Watcher attacked Olivia. She says they're dangerous.
In the lab, Ella thinks Nina was lying. She doesn't trust her.
In Noir Ville, Olivia smashes Nina's taillight. Astrid tells Olivia about MD's president, William Bell, who hasn't been seen for years, as Olivia follows Nina's car.
At her house, Olivia hears Nina inside telling Bell (we hear Leonard Nimoy's voice) that Peter has the glass heart. Olivia sees them, noir-style teleconferencing through a black and white TV. They plan to use the heart to create a door between the universes, so they can finally be together again. But as Olivia is peeping, someone comes up behind her and knocks her out.
She wakes up hog tied on a boat. The Observer/Watcher is there, with Nina, who tells her she warned her to stay away. The Observer, "Mr. Gemini," picks her up and puts her in a wooden box. She tries to call Ester/Astrid, but gets no signal. And then she's in the water.
She's fighting to get free and sinking when someone pries open the lid. It's Peter, who pulled alongside in his inflatable raft. He wraps her in a blanket.
Back at his house, Olivia sees a map with pins radiating out from Boston.
Peter makes her breakfast and says he was following her because he heard she was looking for him. He asks about music and says he doesn't like to dance, but would with her.
She tells him Walter hired her because Peter stole his heart. Peter laughs and takes her to the map, with 147 pins, each one representing a child hurt by Walter Bishop.
He tells her Walter's ideas come from the dreams of children; he steals them and replaces them with nightmares.
He says he only just found out, it's why he was willing to die so Walter could live. Peter unbuttons his shirt and opens his chest to reveal the glass heart. He says he was born with it but was willing to give it to Walter because of all the good he could do.
Just then there's a rumble and shake and a giant drill comes through the wall. "They found us," Peter says.
A group of Watchers bust in and Peter and Olivia fight them off. She gets separated from him and disarms her foes but comes back to Peter to find the glass heart ripped from his chest.
She frantically rummages for batteries and Peter tells her it's like the game Operation in reverse. She has to put them in, but without touching the nerve endings. She reaches into his chest for a wire and wraps it around a battery. He asks why she became a detective and she says she did it to care for people.
She gets the first battery in and is working on the second when Peter is saying he thought he knew who he was, but he was wrong. He goes limp. Olivia sings a melancholy version of "For Once In My Life." When she finishes, Peter wakes up with a start.
They head off to get the heart. Olivia knows Nina doesn't have it.
They bust in on Walter in his lab, where he's cradling the heart. Olivia recognized the drill which came through the wall from his sketches. She knows he brought the Watchers over.
Walter tells Peter he never meant to hurt anyone, and promises he can change. He sings a little "Candyman." But Peter says it's too late and leaves with his heart.
Walter's left alone and sad.
In the lab, Ella objects to the ending, saying it's supposed to be happy. She retells it.
Walter asks for a second chance and Peter, Ella tells us, looked in his eyes and saw there was still good, so he took the heart in his hands and split it in two, one half for each of them.
And Peter and Olivia danced and lived happily ever after, the end.
Real Olivia comes back with no news about Peter. But Walter agrees Ella's ending was much better.
Astrid drives Walter home. From across the street, August (Peter Woodward), a younger Observer, watches and makes an inter-universe call. "The boy has not returned and I do not believe Dr. Bishop remembers my warning. Yes, I am concerned, too."