Described in this thread:
http://www.ootpdevelopments.com/boar...d.php?t=121800
, but it's not clear whether it's been noted.
Essentially, the AI is refusing to trade for veterans with any kind of decent sized contract, reguardless of that player's ability, the weakness of their team, or their position in the penant race.
Players have attempted trading superstar mid-career players with reasonable contracts and are only given the 'We won't trade for overpaid veterans' reguardless of that team's needs or financials.