The inner sleeve is actually the cylinder wall with piston travelling inside as normal, the outer sleeve slides over the inner, both sleeves slide up and down, timed to provide opening and closing of intake and exhaust ports as required. The sleeves are activated by a "camshaft" with connecting rods, talk about reciprocating mass! Expensive precision machining would be required for this to work, and oil consumption was normal.
This technology would probably have been seen to be viable when poppet valves burned out early and regularly, and valve spring metallurgy wasn't up to the job.
More here; Willys Knight