The thing looks like a German hand grenade used on the TV show "Combat!" (Google that one kids, Vic Morrow at his best), but this shock, originally designed by and used exclusively on Gary Fisher mountain bikes (later absorbed into the Trek brand), solves an age-old problem of air sprung shocks.
The Fox-made Dual Rate Control Valve (DRCV) shock is easily identified by its secondary air chamber above the primary air chamber. Why didn’t Fisher simply increase the volume of the air canister? Air shocks with large-volume canisters reduce the runaway ramp-up at the end of the stroke that a conventional air shock has, but you get a hammock effect (a distinct flat pocket during the shock’s midstroke) that is difficult and maybe impossible to correct in a bike’s rear suspension design.
Fox and Fisher suspension engineers got around this with a second air chamber connected to the primary air chamber that is only opened after the shock is past the mid-stroke problem area. This is accomplished mechanically when the shock piston touches the Dual Rate Control Valve (DRCV) plunger. The best part is that there is no rider participation. You don't have to throw any levers. Everything happens automatically.
Cutaway of a German WWII hand grenade.