Do you know that he was actually responsible for backing up this data? This hosting plan costs less than some places charge just for maintaining backups.
They did have the backups - and said so - and then deleted them just to be assholes. So it's moot whether they were responsible for backing up the data; the issue is they deleted it on purpose just to hurt.
They had already terminated their service agreement with this person. If I were a low-margin hosting reseller, I wouldn't bother to keep around the data of ex-customers either.
If you commit to provide a service, whether you're charging $1 or $100k per month, there are some minimum standards of behavior you should hold yourself to. This isn't "you get what you pay for" because the host went down. Maliciously deleting backups that you're supposedly responsible for, over a twitter slapfight, is unethical. No matter what.