Not necessarily, for all we know, that support rep might have mismanaged the case. For example they originally offered free replacements, that's an exception to the rule, Apple's official policy is to charge for lost Airpods. It's not unusual for support reps to give conflicting policies, hence my questioning of the flawed logic of this case.
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I think we might be arguing different things, the problem is that the OP went through several stages during his chat with the support rep and there are different points to argue about. To be clear lets recap:
1. OP called with the intent to purchase replacement Airpods
2. Apple support rep broke policy and offered free replacements (Apple's official policy is to charge for replacements)
3. OP clarified the means by which airpods had been lost was due to theft
4. Apple support rep backed down on the free replacements with the excuse that the airpods weren't lost but stolen
5. OP re-asked Apple to buy replacements
6. Apple support rep denied the sale of replacements with the excuse that the means of losing them was due to theft and not neglect
What I'm arguing is the bolded part, #6. Apple has a policy about lost Airpods, they will let you buy replacements due to loss. Apple NEVER asks for proof whether you lost due them due to neglect or theft, hence the differentiation is ridiculous. One more point, Apple is actually profiting by selling you replacements, it's not like they are doing anyone any favors.
As people already have mentioned before, buying 2 airpods costs $140, whereas buying a brand new set is only $20 more, and you get the charging box, and lighting cable. So Apple is actually ripping people off with the replacements. Why would they deny someone if they wanted to buy them? Doesn't make any sense at all.
My theory is that this case was mismanaged by the support rep, plain and simple.
Apple's official policy is to sell replacements due to loss, there is no specification that the loss has to be only due to neglect rather than theft.