Two years after Travis Strikes Again, Damon had constructed a huge entertainment park in Santa Destroy called Utopiland as part of his corporate empire. However, FU returns to Earth for the promised reunion with Damon. His joy at meeting with his old friend quickly turns to horror, however, as FU declares that he and his so-called Galactic Superhero Corps plan to conquer the Earth with Damon's help. He is then forced to build an elaborate throne for FU, watch as FU kills all of Utopinia's shareholders during a board meeting, and get stuck as his disrespected servant while Utopiland is converted into the "Garden of Insanity" for the Galactic Superhero Corps.
Damon remains in FU's throne room for most of the game, growing more and more annoyed by FU's delinquent personality. His actions lead to Travis getting caught up with the Galactic Superhero Corps, which he secretly relishes, as either way at least one of his enemies will perish. He gets increasingly stressed as he watches Travis cut down alien after alien, eventually taking matters into his own hands by paying 30% of his entire company to hire Henry Cooldown and the Order of the Emerald Night to assassinate Travis. FU begins to realize Damon's true intentions and gleefully taunts him over it, but does not harm him.
Once Travis kills the entire Galactic Superhero Corps and defeats FU, Damon watches as the regressed alien flees in a spaceship. Having placed a bomb on the ship, Damon detonates it, killing FU mid-escape. He also disables a camouflage he has been wearing the entire game, revealing that his face has mutated due to FU's lingering influence in his brain. Travis is surprised by this revelation, and Damon declares that he will get his revenge for the beatdown he received two years ago. He then summons the gigantic mecha Thunder Break, though Travis uses an Arsenal Rollout Model to fight back and defeat it.
After flying into space, Damon and Travis find themselves in a mysterious void resembling Damon and FU's old treehouse. There they decide to settle it with sumo, and Damon takes on a demon transformation. The two have a Super Smash Bros.-inspired battle until Travis knocks Damon off the platform. As he falls into the void and disintegrates, Damon repeatedly shouts a pathetic "I don't want to die!" before completely disappearing.