Sodium dichromate has been linked a range of illnesses
The plant was run by the defence contractor KBR, a company which until 2007 was part of the Halliburton oil corporation.
When the men began working on the site in May 2003 they noticed a reddish orange powder, some of it in bags, some of it in the drains and in the sand.
Initially they thought little of it, but Sgt Tosh says he became concerned when he and some of his team developed rashes, nosebleeds, and breathing problems after coming into contact with the substance.
A few months after the men arrived, notices started to appear around the plant, explaining that the coloured powder was in fact a highly toxic substance - sodium dichromate, the same chemical which was brought to attention in the film Erin Brockovich.
"At the time the warning signs went out around a pump room where this sodium dichromate had been stored in bags previously, and then they said that the orange powder...was actually sodium dichromate. Later on, they moved us from where we were operating, but not very far, only 100 metres away from the site. Once the warning signs went up, we never saw any US national guards again, we were told that there was nothing to worry about, it's all fine."
Sgt Tosh says he believes the US guards left in fear for their safety.
During the time he remained on the site he says he saw KBR workers there, many of them wearing protective clothing.
Sodium dichromate is a highly carcinogenic substance, used as an anti-corrosive. Medical experts say it can cause nosebleeds, damage to the septum, breathing problems and even in some cases lung cancer.
In the 36-page lawsuit, the soliders claim that KBR "disregarded and downplayed" the dangers of being exposed to the chemical. In response, KBR says the sodium dichromate was left at Qarmat Ali by Iraqi workers under Saddam Hussein's regime and that it took action to make the site safe. It adds that it notified the US Army Corps of Engineers of the presence of the substance and its dangers.
A statement from KBR goes on to say:
This is something almost 100 soliders in the United States dispute. Ninety-eight former members of the US military are already suing KBR, claiming they have contracted serious illnesses from their time at the plant.
"I have a laundry list of health problems," explains Larry Roberta, who served with the Oregon National guard. "I only have 60% lung capacity, I have very low testosterone, I have two types of inhalers, I can't walk a block with passing over.
Mr Roberta says the orange dust was everywhere at the plant, and he even ended up eating it when it landed on his food.
The issue of chemical exposure at the Qarmat Ali water plant has been the subject of a number of hearings in the US Senate. Dr Herman Gibb, an expert on sodium dichromate who gave evidence to those hearings, says it can take years for the side-effects of the chemical to manifest. And that is the concern among the British troops who have filed the lawsuit.
"We just want our day in court," explains John Gledhill, from Retford in Nottinghamshire. I want to know we can get some medical screening because there have been numerous national guardsmen over in America who were at the water treatment plant at the same time as us who've got symptoms. I've got no symptoms at the minute, but it's a carcinogenic compound so we don't know what the future holds."
In a statement, the Ministry of Defence says it takes "very seriously" any suggestion that troops may have been exposed to levels of sodium dichromate in Iraq in 2003. But it goes on: "This was examined at the time and there was no cause for alarm ... the results of sampling showed that levels of sodium dichromate were significantly below UK government and US Army guidance levels and should not have had any effect on the patrolling guard force. Should any new evidence come to light, we will obviously consider it."
The ex-servicemen on the lawsuit are also calling for an enquiry into the matter at Westminster.
"It's a bit of a silent risk," says Jim Garth. "It's something we knew nothing about. Granted it wasn't a British installation, but we were tasked with guarding this installation by our superiors - and it looks like this could be a killer as well as the other things in a war zone that can kill you."