|— "Hallowe'en" by Eleanor Farjeon|
Hollis Mason, in New York City, calls Sally Jupiter in California and tells her that he saw Nite Owl II and Silk Spectre II on the news together, so Daniel and Laurie must be together now. Sally and Hollis reminisce about the old days for a while, then Hollis hangs up. On the street corner, the news vendor worries about the state of the world and the oncoming Soviet invasion and thinks about how strange it is that Rorschach used to be one of his regular customers. In the pirate comic, Tales of the Black Freighter, the survivor floats on his raft of dead bodies and imagines pirates cutting his wife apart with their cutlasses. He begins to go insane.
In Dan’s basement, Laurie frets about actually breaking Rorschach out of jail; she thinks it’s an insane idea. Dan makes preparations and insists that they have to do it. Laurie obviously didn’t get cancer from Jon Osterman, the Comedian was murdered, and it seems Rorschach was framed; it all feels like a massive conspiracy, as if someone is trying to “trigger Armageddon.” Dan thinks they should contact Ozymandias, but not until after they break Rorschach loose, just in case he tries to stop them.
In prison, a short man named Big Figure and two goons visit Rorschach’s cell. They want to kill him but can’t reach him, since he’s locked inside. Big Figure tells Rorschach that he’s going to have his revenge soon. He’s been waiting for this chance for 20 years.
At Dan’s house, one of the detectives who arrested Rorschach visits while Laurie is taking a shower. He introduces himself as Steven Fine and chats with Dan, insinuating several connections between him, Rorschach, and the vigilantes who saved people from the fire earlier that week. The detective says that no one’s bothered by heroes rescuing a few people from a fire, but if they make any more appearances, society will return to the “spirit of ’77.” When the detective leaves, Dan tells Laurie that the government is on to them. They have to break Rorschach out within the next day.
In the New Frontiersman office, Hector Godfrey, the editor-in-chief, and his young employee Seymour are pasting a new issue of the paper together. Godfrey tells Seymour to get a filler piece from the “crank file,” which is filled with racist op-eds and trashy articles. Godfrey is thrilled by all the chaos in the news, since it makes for a good newspaper issue. Elsewhere, on an unnamed island, an artist named Hira Manish draws a large picture of a giant squid-like monster, telling Max Shea that she is doing a study of the “facial assembly.” The man references some sort of creature being refrigerated and hauled away on a ship. In Dan’s basement, he and Laurie climb aboard Archie, dressed in their costumes.
Elsewhere, Hollis carves a jack-o-lantern while listening to the news talk about a feud between New Frontiersman and Nova Express. On the street corner, the news vendor chats with a crowd of men. A newspaper headline announces that Rorschach caused a prison riot that left 5 people dead. In the pirate comic, the survivor starts to speak with the corpses keeping his raft afloat.
On Halloween night, Big Figure returns with with his two goons to cut through Rorschach’s cell bars and kill him. Rorschach antagonizes the men outside his cell until one of them, a heavy-set man named Lawrence, reaches through to grab him. Rorschach traps his arms, tying them to the bars with his coat, so that the man’s body blocks the lock they need to cut. Big Figure orders his other man, Michael, to kill the fat one, he complies and slits the man’s throat. Michael cuts through the door with a wired plasma torch and runs towards Rorschach, torch in hand. Rorschach climbs onto his wall-mounted bunk and spills water on the floor, causing the torch’s current to electrocute the second man to death. Terrified, Big Figure realizes he's outmatched and runs away.
Dan and Laurie fly their airship over the prison and see that a riot has started below. Laurie is nervous, but Dan emits a sonic screech from the ship, which incapacitates the rioting prisoners and wardens. Laurie and Dan jump out of the airship and go wandering through the prison. Dan feels like Rorschach has been trying to reach out to him lately, almost like he wants to be “friends.” They find Rorschach in a darkened hallway, walking calmly along. He barely reacts to their appearance and stops to "use the bathroom". However, he says he is glad to see Daniel back in costume. Rorschach finds Big Figure hiding in the bathroom and drowns him in a toilet. Laurie thinks all of this is a mistake and wishes that Jon were with them. They make their way to the roof of the prison, climb in the airship, and leave.
Laurie, Dan, and Rorschach return to Daniel’s house. Laurie seems rattled. She goes into the living room and is startled to find Jon sitting on the couch. Jon says he knew that she wanted to speak with him, so they’re going to Mars to have a conversation where Laurie will “try to convince him to save the world.” This plan bothers Dan, but Laurie thinks it’s the right thing to do, so she goes with Jon. They teleport away. The police, led by detective Steven Fine, arrive outside of Dan’s house and start breaking through the door. Dan and Rorschach get into the airship and fly away.
On the street corner, the news vendor and his friends talk about the reappearance of costumed vigilantes and imagine what it would feel like to be caught in an atomic blast. A gang of Knot Tops force their way into Hollis Mason’s house. He thinks they are trick-or-treaters at first, but they beat him to death and flee. Younger kids in costumes discover his body when they arrive, looking for candy. In the pirate comic, the survivor jumps into the water to drown himself, but he doesn’t sink. He realizes that he has made it to land, reaching his destination at last.
The next section is an excerpt from an article called, “Honor is like the hawk: sometimes it must go hooded” by Hector Godfrey, published in New Frontiersman. Godfrey accuses Doug Roth, writer at Nova Express, of being a Communist agent and un-American, since he criticizes masked vigilantes and started the questions about Doctor Manhattan’s cancer-causing effects. Godfrey harkens back to a more patriotic age and suggests that the masked vigilantes are a continuation of the tradition started by the Ku Klux Klan, who did some bad things but were essentially trying to preserve American culture and prevent it from being “mongrelized.” He calls on the government to investigate Nova Express as traitors.
A back page article states that the police investigation into pirate comic writer Max Shea’s disappearance has been called off. Of note, several other creative professionals have also mysteriously disappeared, including the artist Hira Manish, the architect Norman Leith, and science fiction author James Trafford March. Additionally, the head of recently deceased psychic Robert Deschaines appears to have been stolen from his corpse before his family had time to bury him.