An insurance company is suing Logistec for $4.5 million claiming “grossly negligent acts” by the stevedoring conglomerate caused the fire that sent a warehouse containing 50,000 tons of biofuel wood pellets up in flames May 2 in Brunswick.
A Savannah law firm filed the lawsuit on Sept. 7 at the Glynn County Courthouse on behalf of Tokio Marine American Insurance Co. Tokio insures Fram Renewable Fuels of Hazelhurt, the company that contracted with Logistec to store the wood pellets at the leased site at the Port of Brunswick’s East River Terminal, the lawsuit states.
Tokio seeks to recoup the money it spent to cover Fram’s losses. In its suit, it claims the expense would not be necessary but for Logistec’s “gross negligence.”
“Logistec made almost every mistake it could make in storing wood pellet biofuel, a clean and safe biofuel manufactured by Fram,” the lawsuit states.
The conflagration at Logistec’s leased site on the East River Terminal rocked nearby neighborhoods in Brunswick’s south end with an explosion that sent flames rocketing 75 feet into the air.
Brunswick firefighters battled the blazes into the night. They were assisted by Glynn County firefighters and neighboring fire departments from Savannah to Camden County.
The fire reduced the 140,000-square-foot warehouse to rubble, destroying along with it the biofuel wood pellets that filled it.
It was an all-too-familiar scenario for the city’s south end residents, who watched two 50,000-square-foot Logistec warehouses crammed with wood pellets go up in flames in July 2015 on the same spot. Fire officials determined “spontaneous combustion” within the large piles of wood pellets caused both fires.
Operations halted at the site for three months after the most recent fire. The state fire marshal set a list of conditions Logistec would have to meet in order to resume operations, which included smaller storage spaces, improved communication with the city fire department and more expeditious access to more water for firefighters.
Under a plan outlined by the state fire marshal, Logistec began storing peanut hulls in August at the site it leases from the port. Peanut hulls also are used as biofuel, as well as livestock feed.
Both forms of biofuel ship from the port to European markets.
Peanut hulls are not considered as flammable as the biofuel wood pellets.
For the moment, Logistec has no plans to resume storing biofuel wood pellets, officials have told The News.
The peanut hulls are stored in smaller warehouses or stored in smaller amounts, Logistec said.
The lawsuit claims Logistec stored the biofuel wood pellets in heaping conical piles when it should have stored them in low, level piles that do not induce the conditions for spontaneous combustion.
The lawsuit also alleges Logistec workers loaded wood pellets into the warehouse during an April 24 rainstorm, creating wet pellets that “biodegrade and release heat” and are “more likely to burn.”
Additionally, the lawsuit claims Logistec workers took wood pellets for loading onto ships from the top of the pile rather than the bottom, “leaving a bottom layer simply to degrade and overheat.”
The lawsuit further alleges Logistec had a flawed sprinkler system and allowed flammable wood dust to gather in the rafters.
“Eventually, Logistec’s series of mistakes added up, and the warehouse suffered an explosion, endangering the community and destroying any hope of salvaging the biofuel that Fram had entrusted to Logistec,” the lawsuit states.
Tokio paid Fram $4.5 million to cover its loss of wood pellets and the cost of discarding the destroyed product, according to the lawsuit.
“Tokio Marine has the right to assert these damages,” the lawsuit said.
Contacted Thursday, Logistec officials declined to speak directly to the lawsuit.
A Montreal-based international shipping and stevedoring company, Logistec remains committed to its Brunswick operation and its 45 local employees, officials told The News. The company continues to handle peanut hulls, as well as perlite, specialty salt and fertilizers.
Logistec also continues to work with Fram, the company whose insurer is suing Logistec.
“As a publicly traded company, Logistec does not comment on ongoing litigation matters and we will therefore reserve our comments for the official proceedings,” the company said in a statement issued to The News. “Our team remains committed to our Brunswick operation, the local economy and our customers who rely on this facility. We have served this community and Georgia since 1988.”