Dawn's first Pokémon Contest is just days away, and in order to prepare, she's searching Jubilife City for a Pokétch—a handy accessory that looks like a watch but has multiple useful functions. To her disappointment, the stores' Pokétch supply has mysteriously been recalled, but she gets a free Pokétch from Team Rocket. For some reason, Team Rocket are just giving Pokétch away! But a Shinx and its owner, Landis, expose Dawn's Pokétch as a fake. Landis should know—he's the son of the Pokétch corporation's president!
Landis introduces his father to Dawn and her friends, who learn that the Pokétch corporation withdrew its merchandise when it heard that someone was distributing fakes. But Landis' father does give our heroes a peek at the latest version of the real thing, a Pokétch that measures the Friendship between a Trainer and a Pokémon. As for the fake Pokétch, the truth is soon revealed: Team Rocket is using the fakes to transmit Psyduck's voice! Now lots of Pokémon are listlessly walking through the streets in a Psyduck-induced trance, headed right for Team Rocket's hideout, and Landis' Shinx is one of them!
Of course, our heroes must now stop Team Rocket from scooping up all the Pokémon and taking off in their Meowth balloon. Pikachu and Piplup try to stop them, but Team Rocket just adds those two to the collection as well. Dawn isn't having any more of this nonsense, so she helps Buneary unleash an amazing Ice Beam that puts the villains' plans on ice. With the Pokémon freed, Shinx helps charge Pikachu up with electricity and Team Rocket are sent flying once again, without the benefit of a hot air balloon. Now Dawn can receive a real Pokétch of her own, and she's just about ready to take on the Jubilife Pokémon Contest!
The group arrives in Jubilife City with three days left before the local Pokémon Contest and Dawn's debut. Dawn is set on getting herself a Pokétch, a must-have device for any Coordinator. However, she is disappointed to find the local store is empty. The vendor explains that the Pokétch Company has recalled all unsold Pokétches. Dawn perks up again when she spots three clowns, actually Team Rocket in disguise, giving away free Pokétches to the street crowd. Dawn pushes her way through the crowd. Team Rocket are shocked to see her, but give her a Pokétch, anyway. They also insist that Ash and Brock take one, as well, even though Ash says that he doesn't want one.
The group takes a break in a local park, where Dawn admires her Pokétch. A Shinx then walks up to them, and Ash scans it on his Pokédex before Dawn wonders aloud why it is "barking" at them so much. Its Trainer, Landis, shows up and instantly reveals that the Pokétches are fake. Dawn refuses to believe him, until Landis runs it under water, smearing the paint. When the group asks how he knew they were fake, Landis tells them that his father would never make one in such a "dumb" color.
Inside the Pokétch Company factory, Landis's father, who is also the Pokétch Co. President, apologizes for his son's behavior, but the group insists that it should be the people who made the fakes that should apologize. The President admits that he had the Pokétches pulled from the stores across Sinnoh because of the counterfeit Pokétch crisis. Landis then discovers that Dawn is a Coordinator, which prompts his father to show them a prototype Pokétch, which has a Friendship Checker application. Ash is keen to give the app a try on him and Pikachu, and the President is surprised by the reading, stating that it is almost off the graph. Ash proudly chalks it up to him and Pikachu having known one another for a long time. Brock and Croagunk go up next, and despite Croagunk only being a recent addition, the reading reveals the pair are already quite close, something that stuns both Brock and Croagunk. Dawn, however, is shocked to learn that her friendship with Piplup is low. Landis’s father assures her that friendship increases as a Pokémon and Trainer spend time together. Landis recommends Dawn not even both entering the Contest with those low stats. At this, Dawn orders Landis to test his friendship with Shinx. Landis retorts that he is too young and still studying at Trainers' School, much to Dawn's dismay. The President and his son wish Dawn all the best with her Contest, with Landis admitting she will need all the luck she can get.
By nightfall, Team Rocket's fake Pokétch goes into full throttle. With the help of a Psyduck, they utilize the fake devices' speakers to broadcast a hypnotic tone to attract the Trainer's Pokémon directly to them. Pikachu alerts Ash and his friends to the growing Pokémon procession, while Landis and his father abandon their inspection of the fake Pokétch to chase after their hypnotized Shinx. Landis and his father step outside to look for Shinx, but they instead find Ash and his friends. The father and son alert the group to their discovery of the Psyduck recording within the fake Pokétches. Ash and others follow the Pokémon directly to a giant holding container. Oddly the Pokémon just stand in the box, stuck in a trance. Landis rushes forward to rescue his Shinx, but Dawn leaps to his aid to stop the door crashing down on the young boy. Dawn demands to know who is behind the scheme. Team Rocket responds with their motto before inflating their balloon and firing up their propulsion engines for lift off. Piplup and Pikachu prepare for a Bubble Beam and Thunderbolt combination, but Meowth launches two arms from the balloon, trapping Pikachu and Piplup inside glass capsules. Dawn sends out Buneary and tells it to use Ice Beam, but the Ice Beam can't quite reach the balloon’s height. Still determined, Dawn and Buneary close their eyes and take a moment to concentrate. Dawn calls for a maxed out Ice Beam, and the attack freezes Team Rocket. It also shorts out the rocket boosters, stopping them. As the balloon starts to descend slowly, Piplup and Pikachu are released from their capsules and start to fall. Ash sends out Starly, and has it swoop into to rescue the pair. Starly manages to save Piplup, though Pikachu continues to plummet. Ash runs and dives to try to catch him, but misses, and Pikachu hits the ground hard.
As Ash cradles Pikachu, Team Rocket’s balloon lands and the Pokémon walk out of the damaged container. Brock realizes that the fall must have snapped them out of their hypnosis, and Landis's father orders the Pokémon to go back to their Trainers. Team Rocket then breaks out of the ice and jump to the ground, set on getting revenge. They send out Seviper and Carnivine. Carnivine, of course, bites onto James's head. Team Rocket then orders Seviper and Carnivine to use Poison Tail and Bite, respectively. Dawn decides to retaliate, and has Piplup use Peck and Buneary go in for a Dizzy Punch. Seviper and Carnivine are knocked back. Landis's father then tells Shinx to use Spark on Pikachu, which recharges Pikachu. Meowth extends his claws and Team Rocket and their Pokémon all jump towards Pikachu. Ash orders a Thunderbolt, which sends Team Rocket blasting off.
Officer Jenny and Nurse Joy arrive shortly after, saying that they got there as fast as they could. Brock gets heart-eyed and starts to flirt with them, but Croagunk uses Poison Jab on him and drags him away. Landis then thanks Dawn for saving Shinx. He admits she will do well in the Contest, but says she shouldn’t expect to win much to Dawn's annoyance. With the counterfeit crisis solved, Dawn purchases a genuine Pokétch from the store the very next day, Now armed with a Pokétch on her wrist, Dawn turns her attention to her Contest training.