S1·E19 The Gay Caballeros

Ned enjoys a good relationship with his client, gay fashion designer Brent Barrow, who invites the Dorseys and the Moyers to his restaurant and takes Stacey and Amanda shopping at his warehouse. While helping Stacey put away her new clothes, he notices that she and Ned sleep in separate bedrooms. Stacey tells them that they have an arrangement. Brent says he understands but wrongly assumes she means Ned is gay. Later Eric and Ned arrive at Brent's Mardi Gras party before their wives and notice that only men are in attendance. Ned is eager to correct any misunderstanding with Brent and he tells him that he's straight. Brent assumes Ned is in denial about his sexuality and is ready to quit doing business with him, so Ned now tries to tell him that he is gay after all and in love with Eric. By the time Stacey and Amanda arrive at the party, Ned and Eric have done such a bad job of acting gay that Brent is sure that Ned is truly straight.