The Christmastime episode opens with Jerry at his new girlfriend's office - Lois, who Jerry is quite impressed by (in reference to Lois Lane). It turns out that her boss is Duncan Meyer, an old high school rival of Jerry's. The next scene shows Elaine having a falling out with a Chinese delivery man, which subsequently causes her to be blacklisted from Hop Sing's. George then asks Elaine why Ned, her new boyfriend, has a copy of The Daily Worker, which prompts suspicion of Ned being a communist. George is then intrigued by the personal ads. Jerry arrives and George congratulates him on finally going out with a girl named Lois. Jerry tells George about Duncan, who sees Jerry explain the story to Elaine. In the 9th grade, Jerry got a head start in a race that he won. No one knows but George, though Duncan has been suspicious ever since. Jerry never raced again, and says how a myth grew about his speed - and now Duncan is back.
Jerry then picks up Lois, and Lois quizzes Jerry about cheating in the race. Jerry defends his win, and Lois believes him. Meanwhile, Elaine comes out and asks Ned if he is a communist, which he confirms. Jerry tells George that he did not want to lie to Lois, but he wanted Duncan to never find out about it. George announces he contacted a girl from The Daily Worker. Kramer then comes in, dressed as Santa Claus for his new job that Mickey got him. Lois then rings Jerry, telling him that Duncan wants to meet up. Jerry thinks Duncan is going to ask for a re-race, so George says he'll turn up, pretending he has not seen Jerry since high school, and back up his winning story. Meanwhile, Ned approaches Kramer at the department store, getting him interested in Communist practices. George has also been contacted by Natalie from The Daily Worker at work, and his secretary now thinks George is a communist. At Monk's, while Duncan is protesting the race, George turns up, pretending he has not seen Jerry in years, and backs Jerry's story - George takes the opportunity to claim he is a millionaire architect. Jerry however concedes to Duncan's challenge to race again. Duncan starts to call up everyone from high school to come out for it and Jerry gets worried the legend will die. Meanwhile George has been called into Steinbrenner's office, as he is a suspected communist.
Jerry has now backed out of the race. At Elaine's, she gets Ned blacklisted from Hop Sing's after she orders delivery under his name. Back at the department store, Kramer (as Santa) is accused by a kid of spreading communist propaganda. Kramer and Mickey are then fired. Upon meeting Lois, Jerry finds out that unless he races, Duncan will fire Lois. George then finds out he is being sent to Cuba to recruit baseball talent. At the race, Kramer's car exhaust makes a noise that sees Jerry get another unnoticed head start. With the Superman theme playing in the background, Jerry runs to the finish lie and keeps the legend alive. He hugs Lois and then winks at the camera.