Jack and Rose made their way up from the deck, and overheard the seriousness of the collision being discussed amongst the Captain, Mr. Andrews, and the carpenter. When they heard about the flooding, Jack said in shock, "This is bad." Rose solemnly agreed and said, "We should tell Mother and Cal." The young lovers made their way back to Rose's cabin to warn her mother and soon-to-be ex-fiancé.
Meanwhile in the sitting room the Master-at-Arms was looking at Jack's drawings. Cal was sitting on the couch smoking a cigarette, and still very angry. Ruth was pacing behind the couch in her robe, and grabbed a drink. The Master-at-Arms commented on the drawings saying, "I think they're very good, sir." Cal angrily snatched the drawings from the man's hand, and barked at the steward, "Don't touch anything. I want the entire room photographed."
Lovejoy was standing by the door, when he saw the young lovers in the hallway. As they approached the cabin, Rose was holding Jack's hand and said to him, "Just keep holding my hand." Lovejoy looked at Rose and said, "We've been looking for you, miss." The couple just ignored Lovejoy and prepared to enter the room… while Lovejoy quietly slipped the Heart of the Ocean into Jack's coat pocket.
Rose took a deep breath and said to Jack, "Here we go" as they entered the room. Ruth almost gasped in shock seeing her daughter holding the hand of that third-class boy. Cal blew out the smoke from his cigarette, and angrily turned to face the couple. Rose held onto Jack's hand as she said, "Something serious has happened."
Cal, not bothering to hide the anger in his voice, replied, "Yes it has." Lovejoy quietly nodded to Cal, letting him know that the diamond was now in Jack's pocket.
Cal quickly nodded and continued, "Indeed. Two things dear to me have disappeared this evening. Now that one is back, I have a pretty good idea where to find the other." Nodding towards Jack, Cal barked at the master-at-arms and the steward, "Search him."
The master-at-arms said to Jack, "Take your coat off, son" and walked towards him to do the search. Jack said in exasperation, "Now what?!" as the steward standing behind Jack grabbed the coat and began searching it, and the master-at-arms began to pat him down.
Rose couldn't believe what was happening and said, "Cal, what are you doing? We are in the middle of an emergency. What's going on?!" At that very moment, the steward pulled out the Heart of the Ocean from Jack's coat, and said, "Is this it?" Cal nodded and said, "That's it" and grabbed the necklace from the steward's hand.
Jack couldn't believe that he was being branded a thief and yelled, "This is horseshit!" Jack was very upset and turned to Rose and said, "Don't you believe it Rose! Don't!"
Rose said in disbelief, "He couldn't have." Cal smugly replied, "Of course he could. It's easy enough for a professional."
The master-at-arms proceeded to put the handcuffs on Jack. Rose was now becoming quite upset and said, "But I was with him the whole time. This is absurd!"
Cal coldly whispered in Rose's ear, "Perhaps he did it while you were putting your clothes back on, dear." Rose looked on in shock at Cal's words, and remembered that she had asked Jack to return the necklace to the safe while she changed.
While Rose was thinking, Jack had heard everything Cal had just said to her. Jack quickly came to the realization that Cal had seen the drawing and set him up as revenge. Jack looked up at his rival and said, "Real slick, Cal!" Jack then turned his attention to Rose and continued, "Rose, they put it my pocket!"
Cal shouted, "Shut up!" to Jack, while Lovejoy commented, "It isn't even your pocket. Is it son?" Lovejoy read the tag aloud, "Property of A.L Ryerson" and proceeded to hand over the coat to the master-at-arms.
The master-at-arms solemnly nodded and said, "That was reported stolen today." Jack sighed and replied, "I just borrowed it… I was going to return it." Jack was kicking himself mentally; he really had intended to return the coat, but didn't get the chance to do so after he and Rose had left the bow earlier that afternoon.
Rose just looked at Jack, not sure what to think about him anymore. She shrunk away from Jack; she felt so hurt and betrayed by the man she had fallen in love with.
Cal smiled… his plot to separate Jack from Rose worked out even better than he had planned. He scoffed and let out a slight chuckle at Jack's words and replied, "Oh, an honest thief. We have an honest thief here, do we?"
Jack looked Rose straight in the eyes; his eyes pleading for her to believe him. Jack said to her, "You know I didn't do this, Rose. You know it! Don't you believe them Rose. You know it."
The master-at-arms then proceeded to drag Jack out of the room. Jack continued to say to Rose, "You know I didn't do it." The master-at-arms said to Jack, "Come on, lad. Let's go." Jack didn't stop his shouting, "You know I didn't do it, Rose! You know I didn't do it! Rose! Rose!" as he was dragged out. The master-at-arms tried to keep the young man calm and said, "Come on, there's a good lad! Let's go!", but Jack kept fighting him. Jack still proceeded to shout even as he was dragged into the hallway, "You know I didn't do it! You know me!"
Rose was absolutely devastated and brokenhearted at the whole ordeal. Especially at Jack's pleas of innocence… she didn't know what to believe anymore. Was Jack innocent or just a brilliant thief that took advantage of her? She truly wanted to believe Jack, but her brain and her heart were at war with each other.
As Jack was taken to the master-at-arms' office, he was more than upset with the whole situation. He knew Cal was a bastard, but he didn't think that the man would stoop so low to separate him and Rose. Cal was even more devious than he had thought. But what hurt Jack the most was seeing that hurt and betrayal in Rose's eyes. Rose trusted him, and Cal succeeded in destroying that. Jack couldn't blame her though… Cal and Lovejoy did a great job framing him. Cal, with all his money and power, had effectively taken him out of the picture. The master-at-arms was quick to believe Cal… all because Jack was poor and in third-class. Jack hoped that the woman he loved was okay… he had a feeling that things were about to get worse between her and Cal. Despite that he was being handcuffed to a pipe, he held onto a small sliver of hope that Rose would realize the truth.