As you can see in the following video, each E-ink screen is equipped with sensors that tell it which other screens are above and below. All 3 screens in the demo are plugged into the same computer, and the computer can use the sensors to more closely integrate the 3 screens into a compound display.
Here's more technical detail from the Youtube description:
Stacking physical documents is one of the main forms of spatio-temporal organization of information. We present DisplayStacks, a system that enables physical stacking of digital documents via piles of flexible E Ink displays. With a conductive dot pattern sensor attached to the flexible dis- play, we dynamically track the position and orientation of these displays in relation to one another. We introduce mechanisms for interacting with these physical stacks for access and manipulation of information using asymmetric bimanual interactions, such as providing contextual over- views. Initial user experiences indicate a preference for linear overlaps as a stacking configuration.
I'm not sure we'll ever see this on the market, but it's a pretty cool idea nonetheless. This would be a little expensive to implement and it is not exactly a practical solution, but ideally DisplayStacks would enable you to use several independent ereaders or tablets as a compound device.
Of course, most tablets are fast enough at refreshing the screen that they don't need this kind of trick. And E-ink screens are too expensive for this too be worthwhile, not when it would be cheaper to simply buy a larger tablet.
So I am really not sure what value this idea adds, but that's not unusual for the HML. The researchers there have shown off a number of concepts over the years that look cool in the lab but either have little practical value or depend on really expensive hardware.
But it does still look cool.