One winter evening, Holmes and Watson return to 221B Baker Street at 6 pm to find that a man has left his calling card. Holmes takes one look at it and throws it on the floor with an exclamation of disgust. Watson picks it up and reads:
Charles Augustus Milverton,
Appledore Towers,
Hampstead. Agent.
On the back of the card, he has written that he will return at 6:30. Holmes tells Watson that Milverton is the worst man in London, describing him as the king of all blackmailers. Milverton is known to pay generously for letters which will compromise people of wealth and position. Many servants, unable to resist the lure of hundreds of pounds, are willing to pilfer compromising letters from their employers to sell to this slimeball, and so are some confidence tricksters who have lured gullible women into behaving indiscreetly. Holmes says that Milverton has ruined many lives and families with his insatiable greed for blackmail money. Watson wonders how the fiend can get away with his crimes, but Holmes points out that criminal prosecution would require witnesses, and that no one is going to destroy their own reputation- or marriage- by admitting to their guilty secrets in a court of law.
Holmes then tells Watson that he is handling a case for Lady Eva Brackwell, who is marrying the Earl of Dovercourt in two weeks. Milverton has gotten his hands on some imprudent letters that she at one time wrote to a young squire of her acquaintance. He will deliver these letters to the Earl if Lady Eva doesn't pay him a large sum of money, and the Earl will probably break their engagement. She has asked Holmes to make terms with Milverton.