Karliah saves S'oggy's d*ck by sowing it back on to his body.
She has S'oggy go meet Enthir to find evidence that Mercer had indeed betrayed the Thieves Guild. S'oggy finds out about her past and how Mercer and Karliah were dating and had a threesome with Gallus. Mercer got jealous of Gallus and killed him.
Karliah, Brynjolf, and S'oggy head off to Nightingale Hall to become Nightingales, an elite group of thieves serving Lady Nocturnal. They track down Mercer in a Dwemer Ruin to defeat him and get Nocturnal's skeleton key back.