In the
 United States Court of Appeals
              For the Seventh Circuit
                        ____________

No. 07-3138
MAS CAPITAL, INC.,
                                            Plaintiff-Appellant,
                               v.

BIODELIVERY SCIENCES INTERNATIONAL, INC.,
                                            Defendant-Appellee.
                        ____________

         Appeal from the United States District Court for the
           Southern District of Indiana, Evansville Division.
    No. 3:04-cv-0092-DFH-WGH—David F. Hamilton, Chief Judge.
                        ____________
      ARGUED FEBRUARY 12, 2008—DECIDED MAY 1, 2008
                        ____________


 Before EASTERBROOK, Chief Judge, and RIPPLE and
ROVNER, Circuit Judges.
  EASTERBROOK, Chief Judge. MAS Capital filed suit in a
state court to collect what it says is due for services ren-
dered to Biodelivery Sciences, which removed the pro-
ceeding to federal court under the diversity jurisdiction.
The district court granted summary judgment for
Biodelivery, ruling that the suit is barred by a release.

(S.D. Ind. Aug. 25, 2006).
Before we can address that question, we must decide
2                                             No. 07-3138

whether the controversy is within the federal courts’
subject-matter jurisdiction.
  When removing the suit, Biodelivery alleged that it
was incorporated in Delaware and had its principal place
of business in New Jersey, while MAS Capital was both
incorporated and had its principal place of business in
Indiana. Evidence has since shown that the allegations
about MAS Capital’s citizenship were incorrect. When
the notice of removal was filed (which is the time that
matters, see Gibson v. Bruce, 

(1883)), MAS
Capital was incorporated in Nevada and had its principal
place of business in Taiwan. This led us to inquire
whether 28 U.S.C. §1332 supplies jurisdiction, because if
MAS Capital is treated as a citizen of both Nevada and
Taiwan, neither §1332(a)(2) (which covers suits between
“citizens of a State and citizens or subjects of a foreign
state”) nor §1332(a)(3) (“citizens of different States and
in which citizens or subjects of a foreign state are addi-
tional parties”) is a comfortable fit. Subsection (a)(2)
doesn’t work because MAS Capital has a domestic citi-
zenship, and subsection (a)(3) because MAS Capital is
not an “additional party”.
  This circuit has never considered how §1332 treats
domestic corporations with principal places of business
outside the United States. But the question has arisen in
two other circuits, both of which hold that the foreign
principal place of business does not count, so that juris-
diction is proper under §1332(a)(1) (“citizens of different
States”). Torres v. Southern Peru Copper Corp., 

(5th Cir. 1997); Cabalceta v. Standard Fruit Co., 

(11th Cir. 1989). These decisions rely on
§1332(c)(1), which says that “a corporation shall be
deemed to be a citizen of any State by which it has been
No. 07-3138                                                  3

incorporated and of the State where it has its principal
place of business”. Both decisions understand “State” in
this subsection to refer to one of the 50 states only, and not
to foreign states; the result is that a corporation with its
principal place of business abroad has only one citizenship.
   Reading “State” in §1332(c)(1) to mean “state of the
United States” is sensible, if not inevitable. Section 1332
uses the word “State” frequently, always in contexts that
refer to a domestic state, while the statute consistently
refers to a foreign nation as a “foreign state”. The passages
we have quoted from subsections (a)(1), (a)(2), and (a)(3)
illustrate this usage; several other portions of §1332 use
the same expressions. It would be possible, we suppose,
to say that a domestic corporation that lacks a principal
place of business in the United States is treated as
a partnership or limited-liability company, because
§1332(c)(1) insists that every “corporation” have two
citizenships. Then we would need to know the citizen-
ship of MAS Capital’s equity owners. But it seems to us
more compatible with the structure of §1332 to treat
corporations as corporations, and then track down as
many citizenships as each has, rather than to treat
entities organized as corporations as if they were some-
thing else. See, e.g., Moor v. County of Alameda, 

,
717–21 (1973); Hoagland v. Sandberg, Phoenix & von Gontard,
P.C., 

(7th Cir. 2004). We therefore agree
with Torres and Cabalceta. Given §1332(c)(1), MAS Capital
is a citizen of Nevada alone.
  MAS Capital supplied Biodelivery with services designed
to evade the requirements that the Securities Act of 1933
imposes on companies that go public. It incorporated a
shell company, MAS Acquisition XXIII, that it repre-
sented had tradeable securities; then it arranged for
4                                              No. 07-3138

Biodelivery to merge with MAS Acquisition XXIII, which
changed its name to Biodelivery Sciences International.
Voilà! Stock in Biodelivery now can be bought and sold
by the general public. No muss, no fuss, no registration
statements, no prospectuses, no waiting periods—none of
the expense, delay, and disclosure required by the sec-
urities laws. The SEC takes the position that this two-
step, known as going public by the back door, which
sounds too good to be true, is not lawful. It has com-
menced several administrative proceedings against MAS
Capital and Aaron Tsai, its president and sole director.
(Perhaps this is why Tsai has left the country.)
  When the SEC got wind of the transaction involving
Biodelivery, it asked for information about the role that
Tsai and MAS Capital had played, and NASDAQ in-
formed Biodelivery that it would not allow the stock to
trade unless the firm were disentangled from Tsai—who
for his services had issued 300,000 shares of stock in
MAS Acquisition XXIII (and thus Biodelivery) to MAS
Capital, plus options for another 100,000 to himself. Tsai
agreed to sell the stock and options (which he did, receiv-
ing about $150,000) and release any claim to additional
compensation. The release represents that “neither Aaron
Tsai or MAS Capital Inc., either directly or indirectly,
have any right or entitlement to any consideration or
compensation from” Biodelivery. Tsai signed indiv-
idually and as president of MAS Capital. Another clause
in the release states that the promise “may be relied upon
by [Biodelivery] and regulatory agencies with which
[Biodelivery] is currently engaged, including, but not
limited to NASDAQ, NASD, and SEC.”
   Nonetheless, Tsai has tried in this suit to collect addi-
tional compensation. When Biodelivery pleaded the release
as a defense, MAS Capital replied that some fancy foot-
No. 07-3138                                               5

work had revived the claim. Contradicting what MAS
Capital and Tsai had assured Biodelivery, NASDAQ, and
the SEC, MAS Capital now insists that some of the
services were performed not by MAS Capital, but by
MAS Financial, Inc., another of Tsai’s corporations. (Appar-
ently he has a large stable of them.) MAS Financial did not
sign the release, nor did Tsai sign in his capacity as its
agent. So how can MAS Capital sue on a claim owned by
MAS Financial? That’s easy. It asserts that a merger
between the two firms has occurred, and that MAS
Capital is the surviving firm. Voilà! (again).
  The district judge was not amused, and neither are
we. Tsai and his corporations take the law, and their
promises, entirely too lightly. Tsai himself performed the
services; any claim that MAS Financial (and thus MAS
Capital) may have is derivative of his endeavors, and he
has released any claim. We need not go beyond the clause
in the release pledging that Tsai will not receive any fur-
ther benefit from Biodelivery “directly or indirectly”.
Any recovery by MAS Capital would provide an indi-
rect benefit to Tsai, the corporation’s beneficial owner.
The district judge therefore acted rightly in granting
summary judgment to Biodelivery.
  We will send copies of this opinion to NASDAQ and the
SEC so that they may judge for themselves, in their ongo-
ing administrative proceedings, whether Tsai’s promises
are credible. We also direct MAS Capital to show cause
within 14 days why we should not impose sanctions
under Fed. R. App. P. 38 for this frivolous appeal.
                                                 AFFIRMED


                    USCA-02-C-0072—5-1-08