I don't want to rag on you, but the answer to this is really, really obvious--Path certainly screwed up, but that's no reason to lose your head and start making silly claims.
iOS doesn't know what's being uploaded by an app. It can't know. They could ask every time an application wants to access your contacts (which, I think, would really suck for UX, and it'd be a context-free question without indication of what the data would be used for), but after that? There is no practical way to know that that data is being sent over the wire to somebody.
So...what, exactly? "This thing wants to use your contacts." It's a social network. It can be expected to want to use your contacts. It has no bearing on how Apple is supposed to avoid letting Path package up your contacts and send them to Path's servers.
iOS doesn't know what's being uploaded by an app. It can't know. They could ask every time an application wants to access your contacts (which, I think, would really suck for UX, and it'd be a context-free question without indication of what the data would be used for), but after that? There is no practical way to know that that data is being sent over the wire to somebody.