Um... so looking at the tibia, that is 100% an intramedullary tibial nail:

...which means their tibia was broken as fuck, and there's a pretty hefty chance the fibula was also broken as fuck in that same injury.

My guess is the missing segment was fragmented to the point of not being saveable, and removed during the same operation the IM nail was placed.

That doesn't necessarily mean the OP is bullshit - maybe they had some new resident docs, or nurses, or techs or w/e who hadn't seen that before and it was a genuine wtf moment for them. I love it when new staff get that look!