Re: T.I.T. Security
I believe that most bank contracts do specify certain things about how things are stored, giving certain assurances of security, insurance, etc. I'm not sure that they all do, but I've seen such contracts for banks where you store money, and I assume the banks where you store precious metals, because their clientele has the money to afford lots of lawyers, has similarly specific contracts.
Apple specifies in its contract that the data will be encrypted and will not be accessible to others, which is similar to the banks saying they will store the items given to them in a secure vault. Neither mention the specific location or locations where that's going to happen. I see no available legal argument for this case, and from the sound of it, I don't think there should be one.