Found these:
http://www.stahlsblog.com/rip-away-t...oing-applique/
http://tedstahl.com/2013/04/how-to-s...away-applique/
Looks like it's primarily for commercial use, although it could be used with a home embroidery machine too. The video shows how it works.
Last edited by Prism99; 10-21-2013 at 12:22 PM.