They were very popular up until the development of Flame grapes, which are seedless and mature several weeks earlier. Tokay, though, remain sweeter than Flame grapes.
The grape is possibly native to Algeria. It was planted in Lodi, California for the first time in 1847.
The Tokay Grape has no relation to the Tokay dessert wine from Hungary or the variety of grapes used to make that (those are furmint grapes).
Nor does the Tokay Grape have anything to do with the Tokay wine / grape produced in France or the Tocai wine / grape produced in Italy from Pinot Gris grapes. In fact, both France and Italy have been told by the EU that they must stop using the Tokay name by 2006.
The simple truth is that the Americans started making dessert wines when Prohibition ended. Tokay, being the name of a famous dessert wine already somewhere over in Europe (the Hungarian one), sounded as good a name as any to use, so they applied it to California Tokay dessert wines. The name got applied to the grape as well that they used for making their wine. Though the Tokay Grape was used for at first for California Tokay wine, that is no longer necessarily the case.