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At the Abbott mansion, Claire shows Kyle a puppet that Harrison made in his honor. She wanted to prepare him before the boy shows it to him. Kyle stammers that now that he knows what he’s looking at… it might be the most handsome puppet he’s ever seen. Kyle chuckles at the strange looking puppet and jokes that he sees the resemblance. Claire wanted to show it to him first so his face would light up when Harrison shows him. They talk about him having a fun, messy day out on the patio. Kyle learns he’s picked up on the tension between him and Summer. Claire says it’s a good thing that he is talking to her about it. She’ll stay alert for signs that he’s struggling. Kyle hates this, but is grateful he feels he can open up to her about it. Claire knows it’s been tough on Kyle too, so she’s happy to be a sounding board. Kyle thanks her and says he may be starting to see light at the end of the tunnel.

At Jabot, Jack tells Diane, “I’d go with that one.” Diane says that was Billy’s choice last year. Talk turns to him adding Abbott to the Chancellor name. Jack says his brother is great until he turns into an angry brat. Diane thinks this sounds horribly familiar. Jack sighs, “Kyle, you mean.” His son and his brother have the same chip on their shoulder. He feels he’s contributed to their sense of not measuring up. Diane thinks it’s on them if they fell short of expectations. Jack notes if Billy had come through on even one thing, he’d be OK with him using the Abbott name. Diane shoots him a look. She has to side with Billy on one point. It’s not Jack’s place to stop him from using him or Jill from using Abbott on the company. “That name belongs to Billy as much as it does to you.”

Jack says he never claimed to hold title to the Abbott name, but his father’s legacy means everything to him. He just wants the name used in something worthy of its reputation. Diane scoffs that Billy’s hardly going into his venture planning to fail. Jack cites his track record. He doesn’t know if he can help himself. Diane hopes he surprises all of them because she wants Kyle to come back to Jabot and a crowded C-suite seems to be a problem for their son. Jack doesn’t need anymore problems. Diane warns there’s a conflict looming with Victor. Word has it Kyle’s been seen ducking into Newman Tower after hours. Jack snaps that this is classic… Victor cozying up to the people closest to him when he smells blood. They figure Kyle is knowingly working for Victor, the man who wants to take them all down. Jack says it makes him sick to even think about it, but they’d be naïve not to consider the possibility.

Diane feels it makes sense that Victor’s the mastermind pulling the strings, but Kyle was angry at them and may just not want anything to do with them. Jack says it doesn’t explain the late-night visits to Newman. She’s back to the theory that Victor owns Glissade. Jack finds this all repulsive. Diane asks if he still thinks letting Kyle fail on his own is still their best course of action.

By the doors at the Club, Billy complains about being cornered by Victor. He has a meeting with Lily. Victor says Lily’s talking to Nikki and what he has to say won’t take long. “I understand that you’ve rejoined the big leagues.” He says CEOs get together to talk business, if he feels qualified, and invites him to join him in the lounge.

At the table, Lily asks Nikki if she knows what Victor wants to talk to Billy about. Nikki can’t explain why Victor does the things he does. Lily is extra-sensitive since she and Billy are sharing CEO duties. She likes to be kept in the loop. Nikki says Victor feels such loyalty to Chancellor given that Katherine left it to him. Lily points out he sold it to Jill. Nikki says he wouldn’t have if he’d thought it would wind up in Billy’s hands. Lily muses, “Yeah, I didn’t think that was going to happen either when I signed on.” Nikki wonders if the two of them can make things work this time around. Lily respectfully asks why she’s so interested.

In the jazz lounge, Victor tells Billy that the rumors he’s planning to go after Chancellor are lies. Billy wonders why he’s so testy… are the rumors bothering him? Victor thinks his concerns are obsessive. Billy tells him he’s not scared because he won’t succeed. Victor chuckles that he has no use for Chancellor. Billy’s not buying it. Victor alludes to getting lots of calls from people wondering what’s going on at Chancellor. Billy says it’s Abbott Chancellor. Victor muses, “Wow, you’ve no shame, brother. But you’re very lucky that Lily saved your ass.” Billy doesn’t need saving. Victor always wondered why Jill would hand him the reins. Billy says his mother believes he can lift the company to new heights. Victor asks if he’s heard the rumors about her.

In the dining room, Nikki tells Lily she misses Katherine terribly and talks to her quite often. She hears her answering too. She always thinks of it as her company and feels protective of it. Lily doesn’t take her position as her successor lightly. Nikki knows that, and she knows that Katherine would be thrilled to see her at the helm. She does, however, worry about Billy, and Katherine’s legacy. Lily reassures her. Nikki says if anyone can destroy what she’s worked so hard to accomplish, it’s Billy. She’s secretly hoping that Lily is the driving force of the company.

Lily appreciates Nikki’s faith in her and admires her. Nikki says she wouldn’t want to see Lily get blindsided by Billy’s hubris. Lily assures her she’s seen the damage Billy can cause up close and personal, but she also knows what he’s capable of. Nikki sees his potential, he just doesn’t seem able to stay at the top when he gets there. Lily will be keeping an eye on that, but explains that Chancellor is like a family business to her too. Jill and Katherin always made her feel so appreciated. She would never let Billy or anyone else weaken or tarnish her legacy. She cares way too much to let that happen. Nikki says, “Thank you, Lily. That’s exactly what I needed to hear.”

In the jazz lounge, Victor asks Billy if his mother is well. Billy says she’s doing fantastic and enjoying her down time. “You don’t have to worry about the rumors, Victor.” Victor asks him to stop spreading rumors about him coming after Chancellor. Billy says he’ll stay on his side of the sandbox. Victor says it ain’t a sandbox, it’s a lion’s den, “You better watch your ass.” That goes for everyone but the lion. He tells Billy if his mother needs anything, he should tell her to turn to him.

At the Abbott mansion, Claire tells Kyle that Harrison is playing and will be down soon. She notices Kyle is smiling. Kyle admits that he and Summer are making headway with their custody arrangement. For now, it feels like he can actually breathe again. Claire is really impressed with both of them. It shows how much they care about Harrison. Kyle’s not sure he can trust it, but it’s a step in the right direction. He suddenly asks Claire, “Are you free for dinner?” He was thinking Society. “Are you busy?” Claire says, “Yeah, no, not really.” She was going to see if Katie and Johnny wanted to play a board game. Kyle could use her input making a critical decision about the houses the realtor sent over. Claire asks if he’ll bring Harrison. Kyle planned to leave him with Mrs. Martinez. Claire is addicted to real estate listings and excited to help. Kyle asks, “Can I assume that’s a yes for dinner?” Claire says, “Absolutely. Kyle, you picked the perfect person for this.” Kyle grins, “Absolutely.”

At Jabot, Jack no longer thinks that letting Kyle fail is the right move if Victor is on the other side of the curtain. He won’t allow that man to participate in the downward trajectory their son is on. Diane says they have to get back in Kyle’s good graces; he needs their help whether he realizes it or not. Jack says he’ll get the help he needs whether he wants it or not. He says they have to figure out what they’re dealing with… like why Kyle is visiting Victor and if it has to do with Glissade. They’ll have to find an indirect root. Diane thinks they should ask themselves what Victor would do. Jack thinks that’s probably the winning formula. Diane says if it means a little moral compromise to save their son, she’s able and willing to make the sacrifice. They decide to take a break and go to Society for dinner.

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At the Club, Victor rejoins Lily and Nikki. He tells Lily that Billy’s waiting for her in the lounge. He set some boundaries for him. Lily will ask Billy to fill her in and walks off. Nikki tells Victor that Lily thinks of Katherine as family and is very dedicated to the company. There’s no way she’d leave it for Winters. Victor also got the feeling they’re in a power struggle. Nikki says it’s one Lily has no intention of losing.

In the jazz lounge, Lily and Billy bicker over his demeanor after speaking to Victor. He wants to talk about something else. Lily assumes it’s the press release. Billy just told her that to get her there. Lily reminds him her time is precious. Billy says her time is about to free-up. He’s decided their partnership isn’t going to work anymore. He’s decided to fly solo at Abbott Chancellor and her services are no longer needed.

At Society, Kyle and Claire laugh and talk about Harrison. Claire knows he’ll be happy if Kyle and Summer strike a truce. Kyle asks her to be honest, “How much is he sensing the hostility?” Claire says he knows they’re not happy with each other. Kyle grunts, “That kills me.” They think they’re doing a good job of hiding it, but kids pick up on their parents’ tension. Suddenly, he grimaces. Jack and Diane are at the door. “Speaking of parents and tension…”

At the Club, Victor thinks Lily will come around when Nikki’s in charge. Nikki doubts she’ll hand over her power to her easily. Victor thinks she’ll be happy to be part of the team. Nikki thinks he’s underestimating her. Victor dismisses this. Nikki should run Katherine’s company, period.

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In the jazz lounge, Lily asks Billy, “You really think you can tell me I’m out, and I’m just going to walk away? I signed a contract. Does that not exist to you?” Billy will pay it out. It’s a financial hit but it’s better than this situation. She doesn’t trust him and he’s having a hard time trusting her… she wants him to go behind the scenes while she becomes the face of the company. Lily points out he’s a proven liability. Billy grunts, “Well that’s rich coming from someone who actually did prison time.” Lily gawps, “Wow, you’re really going to stoop that low. You are unbelievable.” Billy thinks what’s unbelievable that she wants to call all the shots in a company that bears his name. Lily sneers, “Yeah, because you slapped it on there. I’m not going to let you get away with this.” Billy says his decision is final. Lily says hers is too. “So get ready for a fight. I am not backing down.”

Lily tells Billy this is unbelievable. She stayed with him over her own brother. Billy snarks, “And then you turned on me.” Lily says the entire corporate world thinks he’s a risk. She can’t imagine his mother would be OK with this. Billy urges her to go work with her family. Lily says Jill is her family… she’s her children’s grandmother. Billy sneers that she doesn’t want to fight him on this, “You know I have the power to do it.” Lily fumes, “I will not let you take down Chancellor.” Billy says, “Abbott Chancellor, and you’re missing the point. I’m the one stopping you from taking it down. We’re done.” Lily storms out.

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Jack and Diane walk over to Kyle and Claire and greet them. Diane asks about Harrison and Claire chats about his art pieces. Diane watches Kyle as she laughs about the puppet. Jack asks how things are between him and Summer. Kyle says it’s gotten better. Jack asks if anything specific brought about the change. Kyle smiles, “I’m just focusing on what really matters.”

Later, Kyle and Claire are pouring over houses and Claire thinks he likes the ones that are just like the Abbott mansion. “Maybe there’s some part of you, deep down, that would kind of like to stay where you are?”

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Across the room, Jack and Diane wonder what’s going on with Kyle and Claire. Jack thinks they’ve bonded as friends over Harrison’s care. Diane notes she has a calming influence on Kyle that she appreciates. Jack thinks he’s come up with a way to uncover his connection to Victor.

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In the Club dining room, Victor tells Nikki she laid the groundwork for gaining Lily’s trust. Nikki genuinely likes her. When she talked about how dedicated she is to Katherine, it touched her and was wonderful to hear. Victor says it’s all the more reason to bring her on board when they take over the company. Lily walks past, sits at a table, and rubs her head. Nikki muses that it might be happening sooner than they think. It seems the chasm between Lily and Billy is getting wider as they speak. Victor says, “Yup, seems that way.”

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Next on The Young and the Restless: Diane tries to repair her relationship with Kyle, Sally pushes Adam to come clean, and Billy makes a tough decision.