Tensions mount as Spark, Kaddick and Rufus face off against Duuth Velderan (and his cronies) on the one hand and Venna and Garrett of the Red Nails (and their henchmen) on the other, with Ballast out of action and the gnolls about to return.

The adventurers argue with Duuth as to who is responsible for riling up the gnolls, and while under pressure Duuth says that the Red Nails stole something from the drow that has made them press the attack. Tempers fray even further as Rufus and Kaddick attempt to intimidate Duuth into standing down and explaining everything. Finally he snaps and attacks them, as do his thugs. The Red Nails stay out of it, quietly signalling to their henchmen to recover something from upstairs, but are soon drawn into the fracas, choosing to help the adventurers against the reeve. As the battle progresses, Rufus snaps Ballast from his reverie, and the warrior immediately attempts to attack Venna, who runs outside to revive the incapacitated Pike for protection.

Eventually Ballast stands down and a terrified Duuth surrenders. He admits that he set the gnolls up to be attacked by the drow after one of their hyenas uncovered his secret alchemical lab where he and his cronies make the illegal drug dreamlily. The gnolls were sent to sell slaves – Marik and a number of inconvenient villagers and prospectors – to the dark elves while the Red Nails robbed their temple, framing the gnolls for the crime; they were meant to destroy each other but the plan backfired. Garrett admits that they took an item – a massive stone engraved with giant runes and sigils – from the drow as part of a ‘job’, but didn’t expect to be stranded and under siege as a result.

The gnolls arrive at the end of the confession; their leader, Blacktooth, demands the heroes surrender themselves to pay for the Liondrake’s Roar’s betrayal of their pack to the drow. Kaddick successfully convinces Blacktooth that Duuth alone was responsible for sending them to their deaths. The gnolls agree to pull back and return to Stormreach, but demand Duuth be surrendered to them for justice; when he is handed over, a pack of hyenas maul him to death.

But the danger is not past; the drow are still arrayed in force, and as the gnolls withdraw a dark elf matriarch appears at the back of the hall, demanding the return of their sacred relic, which holds the souls of generations of drow warriors. The adventurers turn to the Red Nails, and Garrett agrees to give the stone back. That still isn’t enough, though, and the matriarch demands further compensation for their losses; knowing the outsiders represent powerful forces, she demands they leave but return with weapons and reinforcement to help the drow – the Vulkoori – defeat their chief enemies, the Firebinders. Kaddick again agrees, only to be told that as assurance, he must leave one of his party behind as an ambassador – or a hostage. With that, drow warriors carry the stone outside, where a giant scorpion claw bursts from the earth to drag it under, and they fade into the night.

Come the morning, the adventurers signal the House Tharashk ship to come to shore to collect them, the Red Nails, the gnolls and the surviving townsfolk. The drow emerge from the jungle to return their slaves, including (at last) the missing Marik’aashta and send a trio of their brave to accompany the adventurers. And when it comes time to leave someone behind, Ballast volunteers for reasons of his own, watching his erstwhile companions leave on the overloaded ship back to Stormreach.