[2] The East Side Kids are ejected from their clubhouse in a raid brought on by complaining neighbors, they have no place to train for an upcoming boxing tournament.
The police commissioner is worried that his son Gilbert, who prefers ballet to boxing, is turning out to be a wimp, so he offers the gang a deal: he'll lay off them if they will take his son in their gang and toughen the boy up.
The East Side Kids get to the casino just before cops raid the place.
Gilbert agrees to participate in the tournament, and is in bad shape after the first two rounds.
Gilbert then confesses the truth about having been at the casino, and his police commissioner father clears Muggs of all charges.