I'm taking this quote, ironically from someone in the yahoo comments quoting to defend Apple, that is apparently from Apple:

What to expect at the Genius Bar. Before you come in for your reservation, be sure to back up the data on the device that needs help. When you get to the Apple Store, ask a team member to check you in to the Genius Bar, or check in using the Apple Store app on your iPhone. During your session, your Genius will gather information about your system and answer your questions. If your product requires repair, the Genius will discuss repair options, explain any applicable charges, and prepare your equipment for repair. Most sessions last about 15 minutes, but some may take longer, depending on the issue.

While the data may be your responsibility, and even Apple warns you to back up the data, the "Genius" in charge of fixing his phone obviously didn't follow protocol. I think that's what could make Apple liable, that they didn't uphold their part of the service agreement.