I will add my own version of the rumor... I met with a WSU medical student at one of my interviews, and they basically told me that the CEO of DMC (Detroit Medical Center) was constantly bumping heads with the Ortho department regarding the lucrative nature (or lack thereof) of the department's services, and he was finally able to convince the board to basically "cut ties" with the department. Therefore, the orthopaedic surgeon group contracted to run the program was pulling its services out of DMC, effectively shutting down the residency program and leaving 40 residents to find other programs to continue their training with.
Again, this came from a WSU student, and I'm not sure how near or far this is to the truth. I also heard from another WSU student during interviews that this had yet to happen, and it was all rumored to be in the works. Regardless, neither party's story involved the continued survival of the WSU program.