Re: Ah, the memories...
Both cosmic rays and boring old slow alpha particles were found to cause problems, but it was the latter that was occuring far more often (and far, far more demonstrably), for certain devices.
The basic issue was very simple: some of the packaging materials used to make the ICs contained isotopes that released alpha particles; as that packaging was right up against the chips themselves those particles wandered onto the silicon and messed things up (oh, if only there was a ten centimetre air gap between the packaging and the chip; but I suppose that would rather defeat the object of making small ICs, so ignore that idea[1]).
There is nothing at all surprising at finding alpha emitters - they are all around us, every day. Say hello to your friendly neighbourhood uranium (and its pals): there is certainly no shortage of that in the environment (especially if you like to collect antique green glass). If you make up a general purpose packaging material, say plastic pellets[2], in a normal plastic-making factory, you may be picking up rock dust as a contaminant (along with cigaretter smoke - which is also radioactive, btw, general dust and shed human skin cells - icky). Nobody minds, because it isn't grossly affecting the products made with these plastics: it is the 1970s, everything is still big and bulky, the odd rough spot is fine! It may not even *be* from external contamination at the end of the line, your initial feedstock chemicals may be glowing (very) gently in the dark. Basically, unless you spend the money to clean things up, radionuclides are everywhere, man; they are crawling over your skin right now[3]!
Ah money - so unless and until you know that you've got a problem coming from the contamination, you just don't bother to do any better.
So the IC manufacturers (ok, let's be honest - Intel, it was mainly Intel we heard about) had dirty, dirty devices. Then everyone started pointing and laughing, Intel spent the money and cleaned up their packaging materials.
[1] Not that that air gap would have helped; yes, the primary alpha products would be stopped, but the horrid little buggers are things like radon. This short lived (3 and a bit day half life) product of uranium decay is a Noble Gas, so, whistling nonchalantly, it'd cross that gap, nestle up to the silicon, bide its time and *poof* suddenly decay, releasing alpha particles and taking your data with it. Just in case the radon didn't work, *its* decay products have even shorter lives, releasing more alpha (and a few beta) particles before peacefully resting as a thin, thin layer of lead (Pb) on your chip. Isn't Nature wonderful?
[2] Not claiming this is exactly what happened, I don't know the chemisty that was (is?) used for packaging the ICs in question; it could have been pelletised thermoplastic, or a two-part epoxy or... ; nor the specifics of how the contaminants got in; but the general point still holds: dirty be bad.
[3] And doing less damage than all the microscopic bacteria