Gray made 30 appearances in 2018, finishing with a 4.90 ERA and 4.17 FIP, per Baseball Reference.
The New York Post's Ken Davidoff reported in November at least 11 teams—including the Padres—had spoken to the Yankees about a Gray trade. According to The Athletic's Ken Rosenthal, the Seattle Mariners inquired about including Gray in the deal that centered around James Paxton. Paxton eventually went to New York for Justus Sheffield and a pair of minor leaguers.
Davidoff spoke to general manager Brian Cashman, who confirmed the Yankees were receiving sustained interest in Gray's services: "I've had a lot of interesting dialogue, whether it's for prospects, whether it's for major league, our need for their need. Whether it's part of a complicated, larger situation that involves prospects and major leaguers going both ways. So I think we've had a little bit of experience with all aspects of it."
The Padres are a team well-suited to take a flier on Gray.
Bleacher Report's Joel Reuter ranked San Diego first in his MLB organizational rankings at the end of the minor league regular season in September. The Padres could afford to part with one or two of their lesser-regarded prospects.
Since the team isn't contending in 2019, San Diego can also afford to hope Gray returns to an All-Star level while running the risk he proves to be no better than a No. 4 or 5 starter.
If Gray has an excellent start to the 2019 season, then the Padres could flip him for a top prospect, much like when they acquired Anderson Espinoza from the Boston Red Sox for Drew Pomeranz. Another down year from Gray, at the other end of the spectrum, wouldn't change much for San Diego in the grand scheme of things.