diff --git a/.monorepo-source.json b/.monorepo-source.json
index 103242a..35f4216 100644
--- a/.monorepo-source.json
+++ b/.monorepo-source.json
@@ -1,7 +1,7 @@
 {
   "productId": "funkycommerce-headless",
   "repository": "coded-letter/superfunky-theme",
-  "source": "coded-letter/coded-letter-monorepo@531e554e57237adb670e5e07edbdf0878e1764cc",
+  "source": "coded-letter/coded-letter-monorepo@86177b0c8ca2c1e1d68cb68f3809a5b9fb0a5d67",
   "sourcePath": "workspace/backend/wordpress/themes/free/funkycommerce-headless",
   "installSlug": "funkycommerce-headless",
   "kind": "theme",
diff --git a/functions.php b/functions.php
index e3d2c00..7c1e24e 100644
--- a/functions.php
+++ b/functions.php
@@ -9,7 +9,7 @@
 	exit;
 }
 
-define( 'FUNKYCOMMERCE_HEADLESS_VERSION', '1.2.11' );
+define( 'FUNKYCOMMERCE_HEADLESS_VERSION', '1.2.12' );
 
 /**
  * Whether Superfunky Pro is active and licensed.
@@ -1095,16 +1095,63 @@ function funkycommerce_with_headless_shortcode_markers( $callback ) {
 	}
 }
 
+/**
+ * Remove WordPress paragraph formatting accidentally stored inside CSS blocks.
+ */
+function funkycommerce_normalize_headless_style_content( $content ) {
+	$normalized = preg_replace_callback(
+		'#(<style\b[^>]*>)(.*?)(</style\s*>)#is',
+		static function ( $matches ) {
+			$style = $matches[2];
+
+			if (
+				! preg_match( '#<br\s*/?>#i', $style )
+				|| ! preg_match( '#</p>\s*<p(?:\s[^>]*)?>#i', $style )
+			) {
+				return $matches[0];
+			}
+
+			$style = preg_replace( '#<br\s*/?>#i', "\n", $style );
+			$style = preg_replace( '#</?p(?:\s[^>]*)?>#i', "\n", $style );
+
+			return $matches[1] . $style . $matches[3];
+		},
+		$content
+	);
+
+	return is_string( $normalized ) ? $normalized : $content;
+}
+
+/**
+ * Remove paragraph wrappers that content filters add around protected code placeholders.
+ */
+function funkycommerce_unwrap_headless_code_placeholders( $content ) {
+	$placeholder = '<pre data-funkycommerce-preserved-code="fc-preserved-code-\d+"></pre>';
+	$patterns    = array(
+		'#<p(?:\s[^>]*)?>\s*(' . $placeholder . ')\s*</p>#i',
+		'#<p(?:\s[^>]*)?>\s*(' . $placeholder . ')#i',
+		'#(' . $placeholder . ')\s*</p>#i',
+	);
+
+	foreach ( $patterns as $pattern ) {
+		$unwrapped = preg_replace( $pattern, '$1', $content );
+		$content   = is_string( $unwrapped ) ? $unwrapped : $content;
+	}
+
+	return $content;
+}
+
 /**
  * Run content filters without allowing paragraph formatting inside code tags.
  */
 function funkycommerce_filter_headless_content( $content, $filter = 'the_content' ) {
 	$preserved = array();
+	$content   = funkycommerce_normalize_headless_style_content( $content );
 	$protected = preg_replace_callback(
 		'#<(script|style)\b[^>]*>.*?</\1\s*>#is',
 		static function ( $matches ) use ( &$preserved ) {
 			$key         = 'fc-preserved-code-' . count( $preserved );
-			$placeholder = '<div data-funkycommerce-preserved-code="' . $key . '"></div>';
+			$placeholder = '<pre data-funkycommerce-preserved-code="' . $key . '"></pre>';
 			$preserved[ $placeholder ] = $matches[0];
 			return $placeholder;
 		},
@@ -1116,8 +1163,10 @@ static function () use ( $filter, $protected ) {
 			return apply_filters( $filter, $protected );
 		}
 	);
+	$filtered = funkycommerce_unwrap_headless_code_placeholders( $filtered );
+	$filtered = strtr( $filtered, $preserved );
 
-	return strtr( $filtered, $preserved );
+	return funkycommerce_normalize_headless_style_content( $filtered );
 }
 
 /**
diff --git a/package-lock.json b/package-lock.json
index 70938a5..2d5fdb4 100644
--- a/package-lock.json
+++ b/package-lock.json
@@ -1,12 +1,12 @@
 {
   "name": "funkycommerce-headless-theme",
-  "version": "1.2.11",
+  "version": "1.2.12",
   "lockfileVersion": 3,
   "requires": true,
   "packages": {
     "": {
       "name": "funkycommerce-headless-theme",
-      "version": "1.2.11",
+      "version": "1.2.12",
       "devDependencies": {
         "autoprefixer": "^10.4.20",
         "esbuild": "^0.28.2",
diff --git a/package.json b/package.json
index b415d4d..92ee3c8 100644
--- a/package.json
+++ b/package.json
@@ -1,7 +1,7 @@
 {
   "name": "funkycommerce-headless-theme",
   "private": true,
-  "version": "1.2.11",
+  "version": "1.2.12",
   "description": "Tailwind/build tooling for the FunkyCommerce Headless WordPress theme's native frontend assets (block templates, template parts, loader, and Spotify slot).",
   "scripts": {
     "build:css": "tailwindcss -i ./assets/css/theme-source.css -o ./assets/dist/theme.css --minify",
diff --git a/readme.txt b/readme.txt
index e57f540..4458d0e 100644
--- a/readme.txt
+++ b/readme.txt
@@ -4,7 +4,7 @@ Tags: headless, woocommerce, wpgraphql, full-site-editing
 Requires at least: 6.7
 Tested up to: 6.8
 Requires PHP: 7.4
-Stable tag: 1.2.11
+Stable tag: 1.2.12
 License: GPL-2.0-or-later
 License URI: https://www.gnu.org/licenses/gpl-2.0.html
 
@@ -15,6 +15,11 @@ Control Center, the theme also ships a complete native WordPress rendering path
 "Native frontend theme" below) with accessible header/footer/navigation templates and
 core front/home/singular/archive/search/404 routes styled to match the storefront.
 
+== 1.2.12 highlights ==
+
+* Repairs legacy paragraph and line-break markup injected into Custom HTML CSS blocks.
+* Prevents content filters from leaving paragraph wrappers around preserved script and style blocks.
+
 == 1.2.11 highlights ==
 
 * Restores Control Center tab switching after settings were split into safe per-section forms.
diff --git a/style.css b/style.css
index 6e9c43e..27a54f9 100644
--- a/style.css
+++ b/style.css
@@ -7,7 +7,7 @@ Description: A minimal, content-first block theme for polished WordPress preview
 Requires at least: 6.7
 Tested up to: 6.8
 Requires PHP: 7.4
-Version: 1.2.11
+Version: 1.2.12
 Update URI: https://github.com/coded-letter/superfunky-theme
 License: GPL-2.0-or-later
 License URI: https://www.gnu.org/licenses/gpl-2.0.html