The night before Rearden's trial, he finally confronts his worthless brother. Rearden says that his brother's fate is no longer his concern. He realizes that for years, his silent consent has enabled his family to endlessly inflict injustice on him. Rearden, the victim, now withdraws his sanction. He'll no longer accept his family's moral standards or their condemnations.
At his trial, Rearden refuses to recognize the court's right to try him. He doesn't regard his sale to Ken Dannager as a crime, and therefore he volunteers no defense. He states that he's proud of every penny he has earned by means of his productive effort in competition on an open market. He knows that he has committed no crime. Rearden Metal is his invention; morally, he has the right to sell as much of it as he pleases. He's being tried on charges that violate his rights and leave him no grounds on which to rationally defend himself. Therefore, he refuses to attempt a defense. He refuses to participate in a charade that makes it look like he has rights. The crowd agrees with Rearden, and the judges decide to fine him and suspend the sentence.
Rearden goes to visit Francisco d'Anconia at his hotel suite in New York. In expressing his admiration for Francisco's intellect, he asks how Francisco can waste his extraordinary talents on a promiscuous hedonism. Francisco responds by discussing the meaning of sex. Francisco says that, regardless of the image he has publicly cultivated, he has slept with only one woman in his life. Rearden believes him. Rearden tells Francisco that he ordered a supply of copper from d'Anconia Copper for a supremely important customer (Taggart Transcontinental), and Francisco is stunned. He reaches for the phone but stops, and Rearden senses that Francisco has the power to prevent some action from transpiring but won't. Francisco swears to Rearden by the woman he loves that he is Rearden's friend. However, several days later, when Rearden learns that Ragnar Dannesjköld sunk the ships bearing his supply of copper, he knows that he must avoid Francisco or he'll kill him on sight.
In this chapter, Rearden withdraws his moral sanction from both the family and the politicians that persecute him. He has realized that morality is the most powerful weapon that evil men wield in their war against good. ("They have a weapon against you," Francisco said at Rearden's wedding anniversary. "Ask yourself what it is, sometime.") The self-sacrifice moral code has been used against him for years. The self-sacrifice moral code allows worthless men to make outrageous demands of productive men, who feel morally obligated to satisfy them. Under this code, a productive man supports a gang of parasites, martyring himself in the name of selfless service. He must embrace his exploiters and proclaim his duty to them. He must feed them his lifeblood while accepting their sneers, abuse, and condemnation. The good man is forced to sanction his self-immolation.
In Atlas Shrugged, Ayn Rand asks what would happen if productive men rejected the demands for service to the parasites and refused to accept guilt for their achievements. Rand provides the answer through Rearden's transformation. Rearden has come to understand that his productiveness is a great virtue and that the behavior of his family and the politicians is evil. At his trial, Rearden refuses to accept their moral right to loot his wealth. By withdrawing his tolerance of their actions, he exposes them for what they are — thieves with vicious pretensions to moral rectitude.
Francisco's sex speech furthers Rearden's liberation from the ethical system that has constrained him for so long. Rearden mistakenly believes that bodily desires are divorced from intellect and the soul. At some level, Rearden knows that his attraction to Dagny is more than physical. His body wants her because his mind knows her greatness. While consciously holding the philosophy that divides the mind from the body, he holds an inner belief — and lives by the view — that the two support each other. Francisco merely gives him the words to recognize what he has always known was true.