A quick perusal of the trademark list at the Patent and Trademark Office shows that the University owns Texas Aggies, but not Aggies. You should get a good intellectual property lawyer and have the term Aggie Student Bonfire trademarked. That should settle all issues.
They pulled this BS with a friend of mine who owns a Bonfire-related website. He called them and talked it out with them. He added a disclaimer to his website stating that he was in no way related to TAMU and they have left him alone ever since.
Personally, if they are suing you, I say f-em and they will never get another red cent out of me. Buncha #^(k-tards.
*edit - spelled like a drunkard - fixed spelling issues.
[This message has been edited by Kip95 (edited 12/19/2005 1:14p).]