When Jessica invites Mike to a private dinner, he thinks it’s because she’s onto him, but Harvey assures him she does that with all future senior partners. Unfortunately, it turns out that Mike’s right and Harvey’s wrong. However, Harvey’s the first to know, and Jessica orders him to fire Mike, giving Harvey the benefit of the doubt that he didn’t know. However, Mike’s excitement about his royal treatment and his plan to “Harvey Specter” a plaintiff holding up a big merger causes Harvey to relent. Rather than firing Mike, or even telling him what’s up, he arranges for Louis to give Mike a big task so he can’t leave abruptly without raising questions Jessica doesn’t want asked. But surely this is only forestalling the inevitable, right?
Well, in a miracle of fortuitous timing, we learn that one Alicia Hardman has died. This is of course relevant in a firm that goes by the name Pearson Hardman, as we learn that Daniel Hardman is the evil partner who was forced out five years hence. But the way they did it was to blackmail him by threatening to expose an affair to his wife, and since she’s gone, so is their leverage. At the funeral, Daniel puts on a big act for Harvey and Jessica about how the last five years with his dying wife have changed him and helped him reconnect with his daughter. But the last thing Jessica and Harvey want is for him to come back, whether that’s true or not. So Harvey offers to keep Daniel away, if Jessica lets him keep Mike.
Mike, meanwhile, has gotten wind of his precarious work situation during the conversation in which Jenny dumped him for wanting to be with Rachel, but Harvey still has him busy trying to clear up that lawsuit so the merger can go through. Mike goes back and forth between the parties and eventually delivers a well-deserved spanking to both of them so the merger can go through. And Harvey re-blackmails Daniel, now threatening to tell his daughter all about his past indiscretions. It seems that all will be well, but Daniel shows up at the office anyway, announcing his intention to return — and to come clean, about everything, to everyone, including his daughter. So much for Harvey’s leverage. And so much for his deal with Jessica to keep Mike. But Harvey warns Jessica that she needs him to fight off Daniel, and he’s not staying without Mike (who seems to be slowly figuring out the situation with Trevor and Rachel, but very slowly). And their departure will make her vulnerable to Daniel. Jessica seems to go for it, but she’s not going to make it easy, challenging Mike to a battle of wits, legal-style. If that’s supposed to be some kind of punishment for him, I don’t think it’s going to work.