Outside, Tom finds Julia and asks where Shrek is. She says he's gone, that her marriage is over. Well, the show needs another DiMaggio, so... Julia starts cry-laughing and says that when she saw Tom's face, she thought he was going to tell her about her reviews, which she actually did read on opening night -- she was just embarrassed because they were so bad. She asks Tom what she's going to do if she can't fix the show, and Tom says he'll help her.
Karen comes back in to talk to Eileen about not firing Ivy. Derek interrupts and says Eileen needs to make a statement in support of Derek or else he's leaving. Eileen says she doesn't give a damn what Derek does, because there is no show. Julia asks what's going on and Eileen says someone (Jerry) told the government about Nick's mob money, which she's been using to finance the show, so now the show is under investigation and the funds are frozen. She leaves to go see her lawyers. Everyone else just stares at each other dumbly. This is why it's better to finance your musicals by selling baseball players.
Karen and Derek sit out on the sidewalk in front of her waitressing job while she says she can't believe what happened. He says his situation is even worse: Follies, The Wiz and Bombshell are all in jeopardy. Karen asks if she can help and says, "I'm still your muse, right?" Karen, you idiot. It's time to start recognizing lines guys use to get you into bed already. Derek says he hopes Karen finds something else and says, "If you do, give me a call. I might need a job." He kisses her good-bye and leaves.
At home, Tom is flipping through the papers, which all have terrible headlines about the show. Julia comes in with a cup of tea (but no scarves in evidence!) and thanks him for letting her crash there. Tom says he's going to tell Sam to take the Book of Mormon tour, so they'll both be single again "at this age," he says dramatically. Tom suggests that Julia just move in: "It'll be like old times. Or a sitcom!" He says they'd be able to get more work done, plus he'd get to see Dull Leo (damn, I hoped Dull Leo had been sold to work in a gravel mine in Bulgaria). She says she'll do it on one condition, that he doesn't hide anything from her, either the truth or the reviews, because it can't make her feel any worse. Tom agrees and says she'll need something stronger than tea for what's in the papers.