Meanwhile, Bruce (posing as Matches Malone) sets fire to a Wayne storage facility so that he can be arrested and taken to jail. As he planned, he is placed in the cell next to the Joker. Although Bruce initially attempts to use this time to analyze the Joker's psyche, the Clown Prince sees through the Matches Malone disguise and reveals that he knows his cell mate is actually Batman. With this particular plan failed, Bruce fetches a spare Batman costume he had stashed outside the prison window and changes into his cape and cowl, using a capsule from his utility belt to melt through the bars and escape.

As Batman returns to the cave to re-think his strategy the Joker is taken back to court for sentencing. Despite Mayor Hill's urging for a long prison stay, the Judge orders Joker to be remanded to a psychiatric facility.

Hearing this, Gordon decides to go and check on Detective Shancoe. When he arrives he gives Sutton the choice between treatment for his burgeoning alcoholism or turning over his badge and gun. Shancoe explains that he'll turn over his badge but not his gun - and as Gordon discovers the body of another GCPD officer, Shancoe fires on him.