Williams played for the Panthers in 2010, 2011 and 2012, primarily on special teams. Over this time he registered 43 tackles and two forced fumbles, appearing in 23 games.
There has been no announcement of which player has been released in order to add Williams, though it's a fair bet to assume linebacker Ben Jacobs will be released with a plan to add him back to the practice squad. Jacobs played in five games for the Cleveland Browns in 2012 and had not made an appearance this season.
It's a move that gives the Panthers more of a veteran prescence on special teams while adding a player who has shown an ability to step into a starting role where needed. Expecting Williams to have a big defensive impact is a mistake, but it's a nice move to bolster the kick coverage unit.