The staggering $56 billion compensation package handed to Tesla CEO Elon Musk in 2018 is being challenged in a United States court.

A shareholder has requested a U.S. judge to revoke the record-breaking award, which was disclosed by the electric vehicle manufacturer four years ago.

Mr. Musk’s salary was related to performance goals, such as Tesla’s stock price and profitability.

However, the lawsuit alleges that the corporation misled investors by implying that the goals were challenging when they were not.

Mr. Musk, whose status as the world’s richest person is related to his Tesla stock holdings, is scheduled to defend the bill on Wednesday.

The case’s resolution may not be known for months.

When Tesla proposed the 10-year compensation package in 2018, it garnered great public interest.

Several shareholder advisory bodies recommended against voting for the plan, citing its excessive generosity. According to recent estimations by the research firm Equilar, the deal is six times more than the aggregate wages of America’s top 200 chief executives in 2021.

Tesla was under pressure and wasting funds as it attempted to accelerate the deployment of the Tesla car, which was intended to bring the business to a broader market.

The approval of Mr. Musk’s compensation package, which allowed him to purchase Tesla stock at a steep discount if the company accomplished its goals, was viewed as a sign of confidence.

Ira Ehrenpreis, a Tesla board member since 2007, said in court on Monday that the package was intended to keep Mr. Musk from pursuing other opportunities.

The package was approved by more than 70% of Tesla shareholders, although the complaint claims that many of these shares were owned by Mr. Musk’s close associates.

Richard Tornetta, a minor shareholder whose business sells automobile radio system components, has filed a complaint. In addition, he asserts that Tesla misled the public by claiming its goals were tough when, in fact, the corporation had always anticipated achieving them.

The trial will be presided over by the same judge who presided over the case between Mr. Musk and Twitter. This disagreement was resolved before the trial when Mr. Musk agreed to purchase the social media site for $44 billion, as promised.

According to analysts, Mr. Musk has a stronger chance of winning this time.

Boards have broad pay-setting authority, however, the standard is higher if the employee in question is a substantial stakeholder.

According to the lawsuit, Mr. Musk’s friends and brother comprised a majority of Tesla’s board, making it impossible to consider it independent.