McFadden is available on a free transfer after leaving Birmingham in the summer and is being chased by several clubs.
He recently trained with Everton's Premier League rivals, Wolves, and has also been offered the chance to link up with Celtic for a trial.
SPL giants Celtic are reportedly favourites to snap up McFadden, who made over 130 appearances for Everton before leaving for Birmingham in 2008.
Moyes, who brought the Scotland international to Goodison Park from Motherwell in 2003, revealed he has spoken to McFadden about coming back to Merseyside.
The Toffees boss is not conceding defeat in his bid to add the 28-year-old to his squad, but suggested his signing is unlikely.
"We have been talking to James and the people behind him for the last few weeks," said Moyes.
"It could happen but I would say it's probably going against that now."
Source: Team Talk
Source: Team Talk