Pitts

We apply to the resolution of the complex matter of this ease relatively simple rules. We undertake a lengthy examination of the history, as well as the content, of the attacked regulation of the Director of the Department of Employment to show that he did not violate the precept that he must not act arbitrarily, capriciously or without evidentiary support. We explain, too, why the director properly applied the regulation to existing plans of disability insurance, *828 and in so doing did not effectuate an unlawful retroactivity.

The attacked action of the director comprises two regulations (Cal. Admin. Code, tit. 22, §§ 3254(i)-1, 3254(i)-2) which he adopted pursuant to Unemployment Insurance Code sections 3254, subdivision (i), and 3270 to prevent private insurance companies from substantially selecting risks for unemployment compensation disability insurance that would adversely affect the State Disability Fund. Some of those companies brought an action in the Superior Court of Sacramento County for declaratory relief to determine the validity of the regulations and to enjoin their enforcement. The court issued a preliminary injunction enjoining the director from enforcing the…