In the scene, Derek instinctively reacts protectively toward the narrator when Liam approaches. Derek's growl indicates his possessiveness, showing how much he cares about her. Such a reaction establishes Derek's strong feelings and his desire to keep her close. Liam's playful attitude contrasts with Derek's tension, as he continues to test Derek's boundaries with laughter.
Liam finds humor in the situation, suggesting that the connection between Derek and the narrator is special, even calling it cute. His lighthearted teasing highlights both the camaraderie among the characters and the emerging bond between Derek and the narrator, indicating that a deeper relationship might be forming.