Y&R SHOCKER: Nick Finds the MISSING MURDER WEAPON — But Is He Being Set Up?!

On the July 16 episode of The Young and the Restless, the investigation into Damian’s murder took some twists as Chance interrogated Phyllis, Devon theorized there was more to Cane and Damian than anyone thought, and Nick came forward with a key piece of evidence.

What happened on The Young and the Restless

Chance announced to Nick, Phyllis, Abby, Devon, Lily, Amanda, and Cane in the train car that he’d be conducting an unorthodox investigation into Damian's death. Amanda said she needed to confer with her client alone. Cane countered that he had nothing to hide.

Amanda pointed out that Chance has no jurisdiction in France as he's a lawman in Genoa City. Chance conceded Amanda’s point, but he said he’d do everything to get to the bottom of this. Devon pointed out Cane had already predicted something like this would happen. Chance revealed that Cane’s employees were headed down the mountains to contact local police.

Lily asked if Cane had planned this all along. Devon said it was convenient that Cane had his lawyer, Amanda, on the scene. Abby quipped the party invitation should have read: “B.Y.O.L” – Bring Your Own Lawyer. Cane pointed out that Michael Baldwin was there to help others legally. Chance said this whole thing was unorthodox. “Like all murders,” Phyllis quipped. Nick asked what about the guests who weren’t in the train car. Chance said he’d talk to them later. Lily said the only person with a motive was Cane.

Cane said that Damian and Lily let them know that they were involved, but he maintained that he, not Damian, was the intended target. Cane said they were both drugged from his bottle of bourbon. Cane told Lily that he wasn’t as affected by the drug as his adrenaline kicked in. Lily quipped that killing someone would do that to a person. Nick pointed out to Cane that he offered a drugged drink to the man he found out was his romantic rival.

Phyllis said she could confirm that Damian was stabbed. Chance revealed the knife belonged to Cane and it’s now missing. Cane presented the box of knives to Damian. Lily recalled that Damian showed him that box. “We have to make sure his killer is punished,” Lily said. Devon assured her that that would happen. Chance suggested they all go to their cabin cars, and he would come and talk to them. Phyllis surmised that if they refused to speak to Chance, he’d assume they had something to hide. Devon asked if the rest of them could be in danger.

Chance said this seemed like a calculated attack and that they all should be safe. Amanda countered that Cane might not be safe. Lily was miffed that Amanda was already planning Cane’s defense. Amanda countered that Lily should know better than anyone that someone should be allowed a defense.

Phyllis told Chance that she had gotten lost in the maze. She ran into Jack and Diane, who were also lost. They split up. Phyllis suggested there was something different about the maze since they all thought they’d figured out the maze, but she felt they were being purposely thrown off.

Nick arrived at Sharon’s cabin. He said Victor and Nikki were not in theirs. Nick informed Sharon that there had been a murder. He said that Damian had been stabbed with a knife from Damian’s collection.

Amanda asked her client if he had anything to do with Damian’s murder. Amanda reminded Cane that she had his best interests in mind. She told Cane he was crushed when he learned Damian and Lily were a couple. Amanda said that the murder weapon was his dagger. She added that the drugged bourbon was Cane’s. With all this in mind, how might it be interpreted?

Phyllis recounted in more detail what she observed when she came upon Cane holding Damian. Chance asked if either had touched the weapon. Phyllis said no. She wanted to perform CPR and save him. Phyllis said she saw nothing else suspicious. Chance asked Phyllis if she saw anything that would indicate whether or not Cane stabbed Damian.

Meanwhile, Abby and Devon comforted a distraught Lily. She told Devon that her relationship with Damian progressed to a new level while they were there in Nice. Lily said that she was blunt when she told Cane that she and Damian were together. “What if it’s my fault?” Lily wondered.

Meanwhile, Nick continued to update Sharon on what happened to Damian. Sharon asked Nick if he thought some stranger did this. Nick said Cane believed he was the intended target. Nick said Phyllis came upon them as Damian was hit. Sharon said that’s the last thing Phyllis needed after her clinic ordeal. Nick said the only person with a motive was Cane.

Nick theorized that Cane would blame Victor because Victor turned him down over his business deal to get Chancellor Industries. Sharon said if Cane tried to pin this on Victor, then Michael would come to the rescue. She added that she was very worried about how all this would affect Phyllis.

Meanwhile, Phyllis told Chance that Cane was just as shocked as she was that there was a knife in Damian’s back. The fiery redhead added that there was no conflict between the men. Phyllis advised Chance to focus his attentions elsewhere. Chance said he’d leave no stone unturned. He suggested that Phyllis could be protecting Cane to ensure her future employment with him.

Cane maintained that Damian wasn’t the intended victim and that the killer just missed. Amanda pointed out that even though his guests are extremely frustrated, they don’t want him dead. Cane said Lily was incapable of hurting him. He wished he could go to her and comfort her. “Yeah, good luck with that,” Amanda said.

Lily wondered how they were going to tell Nate and Amy about Damian. “That poor woman has suffered enough,” Lily lamented. Abby didn’t think Cane could kill someone. “I can’t wrap my head around any of this,” Lily added.

Devon said that Cane is not the person he used to be. Lily wondered if Cane had become like Colin. Lily wondered why Cane fired Damian and then invited him to France. Devon concurred that it made no sense. Lily pointed out that Devon saw something happening between Damian and her, so maybe Cane did too. Abby couldn’t see how anyone there could be a suspect. Devon wondered if there were things about Damian and Cane's relationship that they didn't know about, and maybe that led to Damian's murder.

Devon asked how much they knew about Damian and Cane before Damian came to Genoa City. He pointed out that Victor told them that Damian was looking into Winters before he found out Nate was his half-brother. Devon wondered if Damian had discovered something about Cane that he didn’t want anyone to know. Lily maintained that Damian was innocent. Devon said there were missing pieces to the puzzle, and they may not like them when they come to light.

Phyllis said she wouldn’t protect a killer. Chance pointed out that he investigated Phyllis’s “death.” She pointed out that even if Cane killed Damian, she couldn’t testify against him because she didn’t see anything. Phyllis added that she was with Cane, so he couldn’t hide the bottle of bourbon and the knife.

Cane told Amanda that Lily would never do anything like commit murder. “Who planted that knife in Damian’s back?” Amanda asked. The attorney threw out some other names as suspects – Jack, Billy, the Newmans. She couldn’t come up with a motive. Cane said he’d put nothing against Victor Newman. Cane said Nick was a known hothead. Cane added that the only thing he knew for sure was that Damian was not the intended target. Amanda told Cane she knew that he had a way of reaching out to the police. She wanted to know why they weren’t opening things up to a wider investigation.

Nick told Sharon that he felt bad for dragging her along on this trip, which had turned into a nightmare. Sharon said that Adam got to them and told them the kids were fine. “Poor Damian,” Sharon added about his life ending. Nick asked if this made her think of Heather. Sharon observed that it was as if a dark cloud had followed them. Nick said the investigation was about to get more disturbing.

Cane said he didn’t want to bring in random local authorities to investigate Damian’s death. Amanda pointed out that the police in Nice know the situation better. Cane said he didn’t like the way Amanda was looking at him. Cane asked his attorney if she believed he killed Damian.

Meanwhile, Phyllis told Chance that she didn’t think Cane was guilty. He said he might have more for her later. Then, Nick interrupted them. He was holding a bloodied knife in a plastic bag. Nick said he found it in the bathroom of his sleeping car and that someone is setting him up for Damian’s murder!