I just noticed my watchman goby in full swim mode and the fins look terrible!

The back is frayed and so is the dorsal fin - it is full of holes and ragged. The top edge of the first part of the dorsal fin has a brown edge to it. Basically, it sounds exactly as what I found described online.
The goby has only been in the tank for 12 days. I did notice a small rip in his tail fin when I got him, but didn't think more about it

He has, without a doubt, been harassed some by the dottyback. Today she was all over him, something that I haven't seen before, but that doesn't mean it hasn't happened. I also had a 0.25 spike of ammonia for two days as my old filter broke before my new filter was completely cycled through.
Now, what to do

I don't have a qt tank, so that's out of the question. Can I medicate in the tank (usually a no-no), or should I just catch it and send it to fish heaven? My other three fish, which I just have spent an hour eyeballing, have perfect looking fins.