U.S. SECURITIES AND EXCHANGE COMMISSION
                      Washington, D.C. 20549

                           FORM 10-QSB

[X]       Quarterly Report Under Section 13 or 15(d) of the Securities
          Exchange Act of 1934

              For Quarter Ended: September 30, 2001

                                OR

[ ]       Transition Report Pursuant to Section 13 or 15(d) of the
          Securities Exchange Act of 1934

                  Commission File No. 33-18143-D

                       USAOneStar.Net, Inc.
      (Exact name of registrant as specified in its charter)


             Nevada                                    87-0449399
      (State of incorporation)           (I.R.S. Employer Identification No.)

                  416 W.  Mohammed Ali Boulevard
                    Louisville, Kentucky 40202
                          (502) 585-6364
  (Address and telephone number of principal executive offices
                 and principal place of business)

      Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.  Yes  [ X ]   No  [   ]

      As of November 16, 2001, the registrant had a total of 16,000,000 common
shares outstanding.



                                1
<PAGE>

                  PART I: FINANCIAL INFORMATION

ITEM 1:  FINANCIAL STATEMENTS

      The financial information set forth below with respect to our statements
of operations for the three month periods ended September 30, 2001 and 2000 is
unaudited.  This financial information, in the opinion of management, includes
all adjustments consisting of normal recurring entries necessary for the fair
presentation of such data.  The results of operations for the three months
ended September 30, 2001, are not necessarily indicative of results to be
expected for any subsequent period.







                                2

<PAGE>

                       USAONESTAR.NET, INC.

                          BALANCE SHEETS
               September 30, 2001 and June 30, 2001


                                                    September 30,  June 30,
                                                       2001         2001
       ASSETS                                       (Unaudited)   (Audited)
--------------------------------------------------  ------------- ------------
Current Assets
  Cash                                              $        310  $        60
  Accounts Receivable, net                                13,997       16,687
  Prepaid Expenses                                       426,413      568,550
                                                    ------------- ------------

     Total Current Assets                                440,720      585,297
                                                    ------------- ------------

Property and Equipment, net                               31,441       85,953
                                                    ------------- ------------

     Total Assets                                   $    472,161   $  671,250
                                                    ============= ============


     LIABILITIES AND STOCKHOLDERS' EQUITY
--------------------------------------------------
Current Liabilities
  Current Portion of Capital Lease Obligation       $          -  $    50,900
  Accounts Payable                                         8,902       29,781
  Accrued Expenses                                         4,166       57,101
  Deferred Revenue                                       153,832      205,109
                                                    ------------- ------------

     Total Current Liabilities                           166,900      342,891

Long-term Liabilities
  Note Payable - Related Party                            13,990      634,252
  Capital Lease Obligation, less Current Portion               -       10,803
                                                    ------------- ------------

     Total Liabilities                                   180,890      987,946
                                                    ------------- ------------

Stockholders' Equity
  Common Stock, .001 par value, 200,000,000 shares
    authorized, 16,000,000 issued and outstanding         16,000       16,000
  Paid-In Capital                                        810,850      810,850
  Retained Earnings (Deficit)                           (535,579)  (1,143,546)
                                                    ------------- ------------
     Total Stockholders' Equity (Deficit)                291,271     (316,696)
                                                    ------------- ------------

     Total Liabilities and Stockholders' Equity     $    472,161  $   671,250
                                                    ============= ============


                See notes to financial statements

<PAGE> 3

                       USAONESTAR.NET, INC.

                     STATEMENTS OF OPERATIONS

                                                                     From
                                                                 Inception on
                                                   For the Three July 21,2000
                                                   Months Ended     through
                                                   September 30, September 30,
                                                       2001          2000
                                                    (Unaudited)   (Unaudited)
                                                   ------------- ------------

Revenues                                           $     80,775  $    27,046

Cost of sales                                             2,252            -
                                                   ------------- ------------

    Gross Profit                                         78,523       27,046

Expenses                                                204,506      467,033
                                                   ------------- ------------

Operating Income (Loss)                                (125,983)    (439,987)

Other Income (Loss)                                     (35,280)           -
                                                   ------------- ------------

Loss before Extraordinary Item                         (161,263)    (439,987)

Extraordinary Item - Early Extinguishment of Debt       769,230            -
                                                   ------------- ------------

     Net Income (Loss)                             $    607,967  $   (439,987)
                                                   ============= ============

Net Income (Loss) Per Share                        $      0.038  $     (0.562)
                                                   ============= =============

Weighted Average Shares Outstanding                  16,000,000       782,609
                                                   ============= =============





                See notes to financial statements.

<PAGE> 4

                       USAONESTAR.NET, INC.

                     STATEMENTS OF CASH FLOWS

                                                                     From
                                                                  Inception on
                                                   For the Three  July 21,2000
                                                   Months Ended     through
                                                   September 30,  November 30,
                                                        2001          2000
                                                    (Unaudited)   (Unaudited)
                                                   ------------- ------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss)                                  $    607,967  $  (851,919)
  Adjustments to reconcile net income to cash
  provided by operating activities :
    Early extinguishment of debt                       (769,230)           -
    Issuance of stock for services                            -        1,000
    Depreciation                                          1,732       24,936
    Bad debt expense                                          -       43,500
    Loss on disposal of assets                           35,280            -
  (Increase) decrease in:
    Accounts Receivable                                   2,690      (88,028)
    Prepaid Expenses                                    142,137            -
    Inventory                                                 -      (16,999)
  Increase (decrease) in:
    Accounts Payable                                    (20,879)     147,207
    Accrued Expenses                                     (9,910)      26,247
    Deferred Revenue                                    (51,277)     356,468
                                                   ------------- ------------
      Net cash provided (used) by operating
      activities                                        (61,490)    (357,588)
                                                   ------------- ------------

CASH FLOWS FROM INVESTING ACTIVITIES
  Deposits                                                    -       (1,360)
  Purchase of equipment                                       -      (59,695)
  Proceeds from sale of assets                           17,500            -
                                                   ------------- ------------

      Net cash provided by financing activities          17,500      (61,055)
                                                   ------------- ------------

CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from Notes Payable                            44,240      513,515
  Principal payments on Notes Payable                         -      (94,808)
                                                   ------------- ------------

      Net cash provided by financing activities          44,240      418,707
                                                   ------------- ------------

Increase (Decrease) in Cash                                 250           64

Cash, beginning                                              60            -
                                                   ------------- ------------

Cash, end                                          $        310  $        64
                                                   ============= ============
Supplemental Cash Flow Information:
  Cash Paid for Interest                           $          -  $     4,116
                                                   ============= ============

  Cash Paid for Income Taxes                       $          -  $         -
                                                   ============= ============




                See notes to financial statements

<PAGE> 5

                       USAONESTAR.NET, INC.
                  NOTES TO FINANCIAL STATEMENTS
                        SEPTEMBER 30, 2001
                           (UNAUDITED)


1.   Basis of Presentation

The accompanying unaudited financial statements of USAOneStar.Net, Inc. (the
Corporation), have been prepared in accordance with accounting principles
generally accepted in the United States of America for interim financial
information and with the instructions in Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by accounting principles generally accepted in the United States of America
for complete financial statements. In the opinion of management, all
adjustments, considered necessary for a fair presentation have been included.

For further information, refer to the financial statements and footnotes
thereto included in the Corporation's Annual Report on Form 10-KSB for the
fiscal year ended June 30, 2001.

2.  Acquisition

On August 31, 2001, the Corporation and Palladium Communications, Inc.
(Palladium) entered into an Agreement and Plan of Reorganization by which the
Corporation expects to acquire Palladium as a wholly owned subsidiary through
a stock-for-stock exchange intended to qualify as a tax-free exchange under
Section 368 (a) (1) (B) of the Internal Revenue Code of 1986, as amended.

Pursuant to the agreement the Corporation will issue 183,000,000 common shares
to the shareholders of Palladium in exchange for 6,203 issued and outstanding
shares of Palladium, which represents 100% of Palladium's shares.

3.  Early extinguishment of debt

Certain shareholders of the Corporation forgave $769,230 of debt, including
accrued interest, during the quarter ended September 30, 2001. The amount has
been presented as an extraordinary item on the statement of operations.

<PAGE> 6

      In this report references to "USAOneStar," "we," "us," and "our" refer
to USAOneStar.Net, Inc.

                    FORWARD LOOKING STATEMENTS

      This Form 10-QSB contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.  For this
purpose any statements contained in this Form 10-QSB that are not statements
of historical fact may be deemed to be forward-looking statements.  Without
limiting the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "estimate" or "continue" or comparable terminology are intended
to identify forward-looking statements.  These statements by their nature
involve substantial risks and uncertainties, and actual results may differ
materially depending on a variety of factors, many of which are not within
USAOneStar's control.  These factors include but are not limited to economic
conditions generally and in the industries in which USAOneStar may
participate; competition within USAOneStar's  chosen industry, including
competition from much larger competitors; technological advances and failure
by USAOneStar to successfully develop business relationships.


ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS

      We offer telecommunications services and Internet access to small to
mid-sized businesses, families and individuals.  We rely on commissioned sales
persons and a network marketing structure to sell our products to customers
and independent representatives, and we rely on our independent
representatives to sponsor new representatives.  We have a short operating
history and had a retained deficit of $1,143,546 for the 2001 fiscal year.
However, we have recorded net income of $607,967 for the three month period
ended September 30, 2001.

      Reverse Merger Treatment    In December 2000 Corvallis, Inc. merged with
USAStar Texas, with Corvallis as the surviving entity.  In conformance with
generally accepted accounting principles, the merger has been accounted for as
a "reverse merger" and the accounting survivor is USAStar Texas.  The reverse
merger was completed by the exchange of 13,500,000 shares of the Corvallis
common stock for all the outstanding stock of USAStar Texas.  For tax
purposes, the merger was a tax free exchange pursuant to Section 368 (a)(1)(B)
of the Internal Revenue Code, as amended.  For accounting purposes, USAStar
Texas was acquired for approximately 13.5 million shares valued at $13,500.
The merger was accounted for under the purchase method of accounting using
generally accepted accounting principles.  This means that USAStar Texas'
results of operations are included with Corvallis' from the closing date and
its consolidated assets and liabilities will be recorded at their fair values
at the same date.

      Palladium Acquisition   On August 31, 2001, USAOneStar and Palladium
Kentucky entered into an Agreement and Plan of Reorganization by which
USAOneStar will acquire Palladium Kentucky's common shares through a
stock-for-stock exchange intended to qualify as a tax-free exchange under
Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended.  In
conformance with generally accepted accounting principles, the acquisition has
been accounted for as a "reverse acquisition" and the accounting survivor is
Palladium Kentucky.  USAOneStar intends to exchange 183 million common shares,
with an estimated value of approximately $700,000, for approximately 6,203
shares of Palladium Kentucky common stock.  Management expects to complete the
acquisition within the next 30 days.

RESULTS OF OPERATIONS

      The financial statements included with this report present financial
information for the operations of only  USAOneStar for the three month period
ended September 30, 2001, our first quarter of the 2002 fiscal year.  They are
not consolidated with the operations of Palladium Kentucky.

      During the 2002 first quarter, we received revenues from the sale of
Internet access, web-based applications and from continual hosting of our
client's web sites.  Our revenues were also related to new independent
representatives joining the USAStar network marketing program and the
corresponding growth in our customer base.  Pursuant to the SEC Staff
Accounting Bulletin No. 101 our revenues related to agreements for web-based
applications and web site hosting are recognized ratably over the initial term
of the contract.  Monthly


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<PAGE>

charges for Internet access are recognized when billed.  Revenues for the 2002
first quarter were $80,775, a $53,729 increase from the 2001 first quarter.
Our revenues have increased each quarter since beginning operations in July
2000.

      Cost of sales consist of the cost of finished products purchased from
third-party vendors.  Cost of sales were $2,252 for the 2002 first quarter and
$0 for the 2001 first quarter.  Accordingly, our gross profit for the 2002
first quarter was $78,523 compared to $27,046 for the 2001 first quarter.

      Operating expenses include selling expenses and general and
administrative expenses.  These expenses were $204,506 for the 2002 first
quarter compared to $467,033 for the 2001 first quarter.  Selling expenses
were higher in the 2001 first quarter due to growth in our network marketing
program.  General and administrative expenses were more in the 2001 first
quarter due to an increase in employees' salaries related to consultant
employment agreements.

      In the 2002 first quarter we recorded an other loss of $35,280 expense
related to independent representatives' charge backs, which occur when an
independent representative elects not to continue his or her business.  We
also recorded an extraordinary item of $769,230 related to shareholders
forgiving $769,230 in debt and accrued interest in September 2001.

      Our net income for the 2002 first quarter was $607,967 compared to a net
loss of $439,987 in the 2001 first quarter.  As a result, we posted a net
income per share of $0.038 for the 2002 first quarter compared to a net loss
per share of $0.562 for the 2001 first quarter.

      Seasonal Aspects   In the network marketing industry, the summer months
of June, July and August, and the holiday months of November and December are
relatively soft.  However, with our short operating history we are unsure how
the industry-wide fluctuations will affect our future business.

LIQUIDITY AND CAPITAL RESOURCES

      We have funded our cash requirements primarily through revenues and
loans.  At the end of the 2002 first quarter we had $310 cash on hand and
total current assets of $440,720 compared to $60 cash on hand and total
current assets of $585,297 at the fiscal year ended June 30, 2001.  Total
current assets included $426,413 allocated to prepaid expenses related to
stock issued for consulting services to be rendered during the 2002 fiscal
year.  Our total current liabilities were $166,900 at the first quarter
compared to $342,891 at the 2002 fiscal year end, with deferred revenue of
$153,832 representing the majority of these total current liabilities.  As of
September 30, 2001, our accumulated deficit totaled $535,579 compared to
$1,143,546 at June 30, 2001.  Our working capital totaled $273,820 at the end
of the first quarter compared to $242,406 at the 2001 year end.

      As of June 30, 2001, our principal commitments consisted of operating
leases for office space with future minimum payments through 2003 of $19,780,
but with our acquisition of Palladium Kentucky and relocation of our principal
offices to Louisville, Kentucky, our office space commitments are now
approximately $3,000 per month.  Future minimum principal payments on long
term liabilities and computer equipment leases totaled $695,955 through 2005
at June 30, 2001.

      Net cash used for operations in the 2002 first quarter was $61,490 and
net cash used by investing activities related to the sale of equipment was
$17,500.  Net cash provided by financing activities for the 2002 first quarter
was $44,240, which primarily came from loans from officers and directors.  In
July 2000 we received loans from our officers of $478,946 and $221,069 which
were unsecured, carried 8% interest and had balloon payments due on July 2005.
We made payments of $69,763 on these loans and, subsequently, in August 2001,
both principal and interest of $669,027 due on the loans were forgiven.
During the fourth quarter of 2001 we received unsecured loans from another
officer totaling $14,569, with no interest and payable upon demand.  We repaid
$10,985 of this debt during the 2001 fiscal year.

      Management believes that our cash needs for at least the next twelve
months can be met by revenues and

                                8

<PAGE>

sales of our stock.  We anticipate that revenues may drop if our arbitration
with Adelphia Business Solutions is not decided in our favor.  We could lose
post termination payments from Adelphia which we estimate to be approximately
$400,000.  The termination of this agreement and the accompanying loss of
revenues may have a material adverse effect upon our future results of
operations.

      In the event revenues are insufficient to support our operations we may
sell our preferred or common stock   We intend to issue such stock pursuant to
exemptions provided by federal and state securities laws.  The purchasers and
manner of issuance will be determined according to our financial needs and the
available exemptions.  We do not currently intend to make a public offering of
our stock.  We also note that if we issue more shares of our common stock our
shareholders may experience dilution in the value per share of their common
stock.

      In anticipation of a private offering, we have entered into an
non-exclusive placement agent agreement with WestPark Capital, Inc., an
investment banking firm located in Los Angeles, California.  This agreement
has a term of twelve months, expiring in January 2002, or upon completion of
an offering, which ever occurs first.  The agreement provides for automatic
renewal for three month periods and may be terminated with thirty days written
notice prior to renewal.  We are not obligated to pay any fees under the
agreement until we have completed an offering.

      If revenues and equity transactions fail to support our operations, we
may rely on third-party financing. We have not investigated the availability,
source and terms for third-party financing at this time and we can not assure
that funds will be available from any source, or, if available, that we will
be able to obtain the funds on terms agreeable to us.  Also, the acquisition
of funding through the issuance of debt could result in a substantial portion
of our cash flows from operations being dedicated to the payment of principal
and interest on the indebtedness, and could render us more vulnerable to
competitive and economic downturns.


                   PART II:  OTHER INFORMATION

ITEM 4:   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      On September 26, 2001, in lieu of a special meeting of shareholders,
written consent of the holders of 123,712,678 common shares approved our name
change from USAOneStar.Net, Inc. to Palladium Communications, Inc.

      On October 11, 2001, in lieu of a special meeting of shareholders,
written consent of the holders of 123,712,678 common shares approved an
increase of our authorized shares of common stock from 200,000,000 to
900,000,000.

ITEM 6:  EXHIBITS AND REPORTS ON FORM 8-K

(a)  Part II Exhibits.

Exhibit            Description

2.1      Agreement and Plan of Reorganization between Corvallis and USAStar
         Texas, dated October 31, 2000 (Incorporated by reference to exhibit
         2.1 of Form 10-Q filed on November 14, 2000.)

2.2      Agreement and Plan of Reorganization between USAOneStar and Palladium
         Kentucky, dated August 31, 2001 (Incorporated by reference to exhibit
         2.1 of Form 8-K filed on September 14, 2000.)

3.1      Articles of Incorporation (Incorporated by reference to exhibit 4 of
         Form S-18 filed on November 9, 1987.)


                                9
<PAGE>

3.2      Articles of Merger filed December 8, 2000, as amended (Incorporated
         by reference to exhibit 3.1 of Form 8-K, filed January 12, 2001.)

3.3      Bylaws (Incorporated by reference to exhibit 5 of Form S-18 filed on
         November 9, 1987.)

3.4      Resolution dated October 20, 2000 amending bylaws (Incorporated by
         reference to exhibit 3.1 of Form 10-Q filed on November 14, 2000.)

10.1     Agreement between Net Related, Inc. and USA Star L.L.C., dated May
         15, 2000. (Incorporated by reference to exhibit 10.1 of Form 10-Q
         filed on February 14, 2001.)

10.2     Agreement between Virtual City Vision, Inc. and USAOneStar.Net, Inc.
         dated September 18, 2000.  (Incorporated by reference to exhibit 10.2
         of Form 10-Q filed on February 14, 2001.)

10.3     Agreement between Hyperion Telecommunications, Inc. and UniVersal
         Communications LLC, dated October 14, 1997, as amended (Incorporated
         by reference to exhibit 10.3 of Form 10-K filed on September 27,
         2001)

(b)     REPORTS ON FORM 8-K

      On November 6, 2001, we filed a Current Report on Form 8-K under Item 4
regarding the dismissal of Chisholm & Associates and the engagement of
McCauley, Nicolas & Company, LLC as our auditors.

      On November 13, 2001, we filed an amended Current Report on Form 8-K
under Items 1, 2, 5 and 7 regarding the acquisition of Palladium Kentucky.
Audited financial statements were filed for the six month period ended June
30, 2001 and for the two year periods ended December 31, 2000 and 1999.
Unaudited pro forma were filed for the six month period ended June 30, 2001
and the year ended December 31, 2000.

<PAGE> 10



                            SIGNATURES

      Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned who are duly authorized.


                                          USAOneStar.Net, Inc.

Date: November 16th, 2001        By: /s/ Raymond C. Dauenhauer Jr. CEO
                                    ---------------------------------------
                                         Raymond C. Dauenhauer, Jr.
                                         President, CEO and Director