United States company PTFS LibLime is denying it has hijacked library management software developed in New Zealand and taken a trademark on its Maori name.
The Horowhenua Library Trust says it devised a software system called Koha 12 years ago to manage catalogues and lending information.
The system is free and widely used by other libraries, churches, schools and corporations around the world.
However, the trust's head of libraries, Joann Ransom, says PTFS LibLime has been granted provisional rights to the name Koha by the Ministry of Economic Development.
She says PTFS LibLime is trying to adapt the Koha system for its own private client base.
"We did something really good and we gave it away to the world and it's been a glorious thing globally for 12 years. And now this American corporate wants to take it," she says.
Ms Ransom told Morning Report the trust tried to block PTFS LibLime's application by lodging an identical claim.
She says she is astounded an international company could trademark a Maori word.
LibLime chief executive John Yokley says his company is entitled to trademark the name because it bought the rights to Koha from a Wellington-based company, Kati Communications, which originally developed it in association with the Horowhenua Library Trust.
The Ministry of Economic Development says trademarks are distributed on a "first come first served" basis and the trust now has the option to dispute the ownership of Koha.
A senior associate at Wellington-based company AJ Park Law, Lynell Huria, says it is unfortunate an overseas company has been able to trademark the name Koha.
She says the trust should win the dispute because they have been using the name Koha for 12 years.
Ms Huria says the current system means the Intellectual Property Office can't turn down a trademark application unless it is offensive to Maori or there is an existing trademark on a similar product.
The library has three months to object to the decision and Ms Ransom says it has little money to pay for a legal case.