Rain falls from the night sky on the Niihama Prefectural Police Headquarters. Outside one of the building's offices, labeled Laughing Man Incident Special Investigation Headquarters, stands a man in a trenchcoat. His clothes are soaked with water which is leaving a large puddle on the hallway floor. He approaches the investigations room where a man, Yamaguchi, is printing out photos.
Yamaguchi: Another one? What's going on here?
He reaches out to touch his computer screen with his finger when he is interrupted by the man from the hall, who calls out his name. Yamaguchi asks what the man, Chief Nibu, is doing there so late.
Nibu: (laughs) Hell of a question. I was working. You know what that is, working? Isn't that what you're doing?
Yamaguchi notices the water dripping non-stop off Nibu's overcoat and see how soaked his pants legs are. Nibu asks Yamaguchi to go out for a drink with him...and reaches into his suit's chest pocket. Yamaguchi declines and, keeping an eye on Nibu, turns off his computer, picks up a large envelope, and walks past his chief, who still has his hand in his suit pocket. As he walks past Nibu, the chief's head drops slightly. Yamaguchi turns a corner down the hall, takes the large envelope, and slips it into a mail slot.
At Section 9, Togusa receives a call from Yamaguchi who is driving down the expressway. Togusa is an old colleague of Yamaguchi's from his days at headquarters and Yamaguchi tells Togusa that he needs him to look at some sensitive data that he has been working on. Despite the late hour, Togusa agrees to meet with his him and asks if something is wrong. Yamaguchi says he's working on the Laughing Man research team, a unit created to capture the man who, six years ago, kidnapped and ransomed the head of a micromachine corporation. He says that some of his colleagues are acting suspicious and he's concerned. Yamaguchi says he'll meet Togusa in an hour and ends the call. However, before Yamaguchi can arrive, the whites of his eyes suddenly blacken and he loses control of his car on the rain-soaked road.
Yamaguchi: Intercepters! They put them in my eyes too!
His car swerves across the road, breaks through an embankment, and falls onto the road below. The front of the car impacts the road, bounces onto it's top, and explodes.
The next morning Ishikawa enters Section 9 and sees Togusa sleeping. He asks Saitou, who is reading the morning paper, if Togusa spent the night at Section 9. Their conversation wakes Togusa. He notices an article on the front page of Saitou's paper and quickly examines the piece.
Togusa: Highway accident? Police officer burned beyond recognition?
In Chief Aramaki's office, Togusa discusses Yamaguchi's death with Aramaki and the Major. While having no evidence, Togusa tells the two that the accident is too coincidental since Yamaguchi was going to show his old colleague some highly confidential information. Motoko plays the devil's advocate, saying it was raining last night and the "poor visibility" could be the reason for Yamaguchi's accident. Aramaki, citing the fact that an officer working on some very classified material has died, allows Togusa three days to find out what he can. Togusa thanks the Chief and exits. Motoko watches her colleague leave, then turns back to the Chief.
Chief: So, we're back on the Laughing Man case.
Motoko finds it hard to believe that after six years the Laughing Man unit is still active, but the Chief says that it's the largest case of espionage since the war and in the six years there has still been no indictment so the case remains open. As he talks, he doodles a few pictures (foreshadow). Motoko feels that headquarters is sitting on the case for some reason and the Chief agrees. Motoko feels that whoever was behind it turned "mediocre" after the initial incident and feels distaste for all those involved. Aramaki agrees, but says that if the higher ups are hiding something then Section 9 will have to get involved.
Rain falls again as Togusa attends a mourning session for Yamaguchi. After presenting himself, he is approached by Yamaguchi's wife, who received an envelope that morning from her late husband with instructions to give it to Togusa. Togusa examines the contents of the envelope and at first doesn't understand why Yamaguchi sent this to him, pictures that Yamaguchi had been printing off earlier.
Back at Section 9, Togusa looks through the photos with the aid of a computer. He examines every inch of the pictures, but has not found anything useful. At the entrance to the office, the Major surreptitiously looks in on him, admiring his dedication.
Togusa takes a break, washing his face and getting a cup of coffee (a coffee dispenser in the bathroom?!). As he begins to leave the lavatory, he looks back at the mirror. Putting his hand up to his face, as if it's holding something, he hits upon an idea. Rushing back to his computer, he examines the photos again. In no time he finds the answer: In each photo, there is no camera present when there should be.
At a little eatery, Togusa is having a conversation with Fukami, a man who works for Serano Genomics and is still part of the Laughing Man unit. Togusa pumps the man for information. Fukami tells Togusa that they have a new material witness who has given information on a suspect that may be targeting Serano Genomics, the first corporation hit by the Laughing Man six years ago. The unit is waiting for the suspect to make a move before they go in. To Togusa's question about how they're going to catch him, the man says they're using a new technology: Intercepters. Just recently legalized, intercepters are micro-surveillance technology that are implanted in a suspect. Although unknown to the suspect, it is perfectly legal if the police issue a warrant. They are good for three months and can see everything the person sees as it's attached to the person's vision center of the brain. The unit only has to monitor the intercepters to find out what the suspect is up to.
Back at Section 9, Togusa presents his findings to the rest of his unit. Intercepters were implanted in the brain's vision center of each member of the very unit investigating the Laughing Man.
Motoko: It may be a little irregular to implant them in your own agents, but it's not illegal. Headquarters can use intercepters all they want as long as they submit the right paperwork.
Togusa: But they didn't submit any paperwork. This was all done in secret. The law requires a neutral third party observer. They didn't have one of those either.
What's more, the intercepters were provided by Serano Genomics, the very company being investigated. This had been the evidence that Yamaguchi had been trying to warn Togusa about, evidence that goes right to the top of Police HQ. Unfortunately, headquarters may now know that Section 9 is involved since the intercepter in Fukami would have relayed the conversation he had with Togusa. In short, time is of the essence.
Moving quickly, the Major gives information on the intercepters to a bartender/informant, who she asks to give to his reporter customers, but no ones that are taking government kickbacks. The next day a reporter, armed with a video camera, approaches Chief Nibu just as he is leaving his home and questions him about the intercepters. Nibu grabs the man's camera and storms off. The reporter walks back to his car and gives a thumbs up to his colleague, who had taken pictures of the "interview".
That evening in a darkened office, a man in uniform, Superintendent-General Daidō, holds a copy of the paper with Nibu grabbing the camera out of the reporter's hand. As he looks over the news, he holds a conversation with someone over the phone about the recent incident. Daidō knows that Aramaki is now on the case so some things are bound to come out, but that only the captain will be fired. Since his wife had not been that fond of the land in Amsterdam anyway, Daidō doesn't really see this incident as a problem.
The next day a news conference is held by the Metropolitan Police. As Section 9 watches the conference on TV, Superintendent-General Daidō reads a report finding that intercepters had been illegally used by Captain Nibu and he has been fired. The reporter who had his camera taken by Chief Nibu asks if it's true that Daidō will soon be retiring to Holland, where, coincidentally, Serano Genomics HQ is located. Daidō refuses to answer and all of a sudden the TV camera moves erratically to Takekawa, who is sitting at the other end of the conference table. Takekawa begins to stand and a logo, a blue outline of a smiling kid's face wearing a baseball cap with words circling the logo, appears patched over his face. It's the same picture that Chief Aramaki had drawn earlier when first discussing the Laughing Man case with Motoko. Through Takekawa, the Laughing Man speaks. He chastises Daidō for the farce he has created, which the Laughing Man does not find funny. The Laughing Man tells Daidō that at the conference to be held in three days, Daido must tell the truth or else the Laughing Man will take care of the Superintendent. The logo disappears and Takekawa falls to the ground. The newscaster breaks in and begins to talk a bit more about intercepters when the TV station's feed is taken over by the logo of the Laughing Man. Aramaki tells Motoko to quickly find out anything she can and the TV is turned off.