After you get rid of the monsters in the gold mine, you return to Fourside.
Receive the Diamond
As you go back to Fourside, the miner's brother drives up in his excavator and gives you the diamond that they found.
Give Miss Fake the Diamond
Go to the Topolla Theater and buy a ticket, and go inside. Go into Miss Fake's office and stand behind her, then use the Diamond on her. She will rip up the Runaway Five's phony contract. The band comes in and thanks you. Go watch their show, then go outside.
The Department Store is open now, but you should get ready before you go there. Remove all of Paula's equipment. You can give it to Ness and Jeff, store some with Escargo Express, or sell it. You can leave things with Paula that you don't think you will need any time soon.
Before you go into the Department Store, make sure that Ness and Jeff have free space in their inventories. Also, if you gave the Franklin Badge to Escargo Express, get it back from them now, and give it to Ness or Jeff. If you don't have any items that can revive unconscious allies (such as Cup of Lifenoodles, Horn of Life, Secret Herb) you might want to take the bus to Threed and use the graveyard secret passage to go to Grapefruit Falls, and from there to Saturn Valley to buy Horns of Life or Secret Herbs. Horns of Life always revive unconscious allies, but Secret Herbs don't always successfully cure unconsciousness.
When you are ready, go into the Department Store. Buy some Big Bottle Rockets for Jeff, and buy some Teddy Bears for Ness to carry.
If you walk between the toy store and the toy display on the top floor of the department store, the Photo Man will take your picture.
Then try to leave the Department Store. During a cut scene, you are told to go to the office on the top floor. There are dangerous monsters throughout the area. Don't hesitate to use Big Bottle Rockets on them, but make sure that you save at least two or three Big Bottle Rockets for the upcoming boss battle.
Department Store Spook
Talk to the alien in the office on the top floor to start the boss battle. Have Ness use his strongest PSI Rockin and have Jeff use a Big Bottle Rocket on the first turn. After that, keep using Big Bottle Rockets. You might want to have Ness conserve his PP for healing, or you can try using Flash or inflicting sleep, since these have a 50% chance of succeeding.
After you defeat the alien, it says something about Monotoli. Don't bother going to the Monotoli building, because nobody will tell you anything. Instead, visit Jackie's Café in the northwest part of town.