Sherlock Holmes receives a cipher message from Fred Porlock, a pseudonymous agent of Professor Moriarty. Holmes deciphers the message as a warning of a nefarious plot against one Douglas, a country gentleman residing at Birlstone House. Some minutes later, Inspector MacDonald arrives at 221B Baker Street with news that Douglas was murdered the night before. The three men travel to Birlstone House to investigate.
Holmes studies the window sill as MacDonald, White Mason, and Watson observe (Strand, 1914)After interviewing Cecil Barker, a frequent guest at Birlstone House, and the man who discovered the body, they agree that suicide is out of the question and that someone from outside the house committed the murder. Barker explains that Douglas married after arriving in England five years earlier. Barker believes a secret society of men pursued Douglas, and that he retreated to rural England out of fear for his life. Mrs. Douglas said her husband mentioned something called "The Valley of Fear". Holmes learns that the housekeeper heard a sound, as if of a door slamming, half an hour before the alarm; Holmes believes that this sound was the fatal shot.
Local detective White Mason and Inspector MacDonald track a bicycle found on the grounds of the house to an American staying at a guest house. The American appears to be the murderer, but there is no sign of him. Holmes asks MacDonald to write to Barker, telling him that the police intend to search the moat the next day. That night, they lie in wait outside Birlstone Manor and see Barker fish the clothes of the missing American out of the moat. Barker refuses to explain the situation. At that moment, Douglas appears, alive and well. He hands Watson a written account called "The Valley of Fear", which explains why he feared for his life.
Barker informs Holmes about Douglas's fate (Strand, 1915)Douglas explains that he had spotted an enemy of his, Ted Baldwin, in the area and expected an attack. When Baldwin attempted to shoot Douglas in his study, Douglas grabbed the gun and, in the struggle, Baldwin was shot in the face. With Barker's help, Douglas dressed the man in his clothes to confuse his enemies. He then hid himself in the old priest hole at Birlstone.
The main narrative pauses to explain Douglas' past in America. Douglas' real name was Birdy Edwards and he had been a Pinkerton detective in Chicago. Working for the Pinkertons, Edwards had traveled to Vermissa Valley to infiltrate a corrupt coal miner's trade union, secretly a cover for a murderous gang. After Edwards brought the gang to justice, the criminals attempted to kill him. Hounded, Douglas ran to England, where he met and married his second wife.
Holmes urges Douglas to leave England. Douglas takes this advice, but, shortly after, Holmes learns from Barker that Douglas was lost overboard on the ship to Africa. Holmes believes Moriarty was responsible for ending Douglas' life and he swears to bring Moriarty down.
