IANAL, but..
So do routers, switches, etc - the data is buffered and kept in memory for shorter or longer time on nearly every piece of internet infrastructure. Squids just speed up data delivery from data store somewhere else. The major issue in such case would be do we work on squid storages as standalone media systems (thats like, if you start filtering content
- you're the one who is responsible for it in the end).
Squids are 'data transfer' infrastructure, not 'data storage' infrastructure, and operating a squid is same as operating a browser (which also does caching), or operating network backbone.
Now, I'm neither a lawyer nor a network expert, but as I understand it, routers etc. only store the data as long as is necessary for a particular transfer. The squids cache data from one transfer in case it's needed for another transfer - I suspect that makes a big difference.