A participle is a verbal ending in -ing(present)or -ed,-en, ,that functions as an adjective, modifying a noun or pronoun
Okay, I read it, now, What is you question? I need more to run with :)
There is a conflict between rumor and reality in this excerpt.
On one hand, we have the rumor - that Nick became engaged to someone, and everybody heard it was true. However, on the other hand, we have the reality - that he in fact is not engaged, thus the whole story is just a gossip rather than something that actually happened.