I had a blue devil damsel once and he began to bite me when I put my hands in the tank to clean. after a year of taking beatings from the fish I placed it in my leopard eel tank. The blue devil damsel beat on the small eel for about six months, smacking the eel in the face with his tail. It all ended one day when I turned on the lights to the tank and found just the head of my blue devil damsel
That was a whoops.
It sounds like its time to give your aggressive damsel a new home. To someone with a larger tank perhaps.
Good luck