Quick recap
The new guardians are Jerome and Esmé Squalor, who live in the penthouse at 667 Dark Avenue. Esmé, the city's sixth most important financial advisor, adopts the orphans because orphans are in. The elevators are out, and Klaus spots an extra door on the top floor. It opens onto an empty shaft, where the Quagmires are trapped in a cage. Olaf, disguised as the auctioneer Gunther, plans to smuggle them out of the city inside an auction lot. Esmé is on his side and pushes the Baudelaires down the shaft. At the auction, Sunny wins a lot that holds only doilies, and Gunther slips on them and is unmasked. The Quagmires were inside the red herring, and Olaf escapes with them.

