Chemical Brokers & Distributors

Brokers or distributors may store chemicals as raw materials or finished goods in containers at warehouses to meet customers’ demand cycles. Improper storage, containment breaches or leaks, or spills during loading and unloading operations can release these materials. Even if the chemical broker/distributor is not responsible for managing the warehouse, they could become liable for cleanup or named as a defendant in a third-party suit because they stored materials there.

Some products stored by chemical brokers or distributors at warehouses may be flammable. Storage of flammables increases the risk of a fire. A hostile fire at a facility could emit toxic fumes and smoke from the materials stored or due to a mix of materials resulting from the fire. Firefighting solutions, such as water or foam, could create contaminated run-off that spreads to nearby storm drains or properties, resulting in environmental cleanup and tort liability. Even if the chemical broker/distributor is not responsible for managing the warehouse, they could become liable for cleanup or named as a defendant in a third-party suit because they stored materials there.

Received chemicals may be stored in bulk aboveground storage tanks (ASTs) or underground storage tanks (USTs). Catastrophic failure of an AST could occur due to an accident or rupture of the tank, a tank could be overfilled, or leaks can occur over time. If no secondary containment is present, secondary containment is inadequate, or the containment structure has become damaged or cracked, releases from an AST could impact soil, groundwater, or surface water and cause injuries or property damage to third parties. Underground storage tanks can also be subject to leaks or spills if they become damaged or cracked, are not adequately monitored, or are improperly maintained.

Cleaning storage or blending tanks may generate wastewater or sludge that could be classified as hazardous waste. Other wastes may include off-specification or expired chemicals. These waste materials must be taken to a non-owned disposal facility or wastewater treatment facility. Spills could occur during cleaning, transport, or from waste storage areas, creating environmental risks. Improper waste disposal could lead to environmental liability or legal consequences for violating regulatory requirements.

Once a chemical is put to its intended use, claims for third-party bodily injury or property damage can result from pollution exposures to the chemical. Although the chemical broker or distributor did not manufacture the chemical, they can still be held liable for third-party lawsuits related to the use of the chemical because they are part of the distribution chain.

Product piping for storage tanks may be aboveground or underground. Releases of products could occur from damage to the piping system, including leaks from joints, elbows, and check valves.

Chemicals may be received in bulk from tanker trucks, railcars, or barges to distribution facilities. Spills or releases could occur during the loading or unloading of chemicals.

Combinations of incompatible chemicals may be stored and prone to react violently or produce toxic byproducts/gases when stored together or mixed. A facility that handles more than one hazardous chemical must meet the requirements of each independent chemical/chemical class and fully understand the relationships between all stored chemicals and classes.

Chemicals or petroleum products can impact stormwater captured in secondary containment structures from leaks or spills from tanks or piping. If not properly monitored or contained, impacted stormwater could escape the secondary containment and impact soil, groundwater, or surface water at discharge.

Chemical distributors may also blend or repackage chemicals. During handling, chemicals could be spilled or released and enter floor drains or flow outside buildings to impact soils or groundwater or to discharge to storm drains.