Then Kidd was arrested on a drunken-driving charge, Lin's departure from New York for a "ridiculous contract" in Houston became more realistic, and a position of strength suddenly was one of turbulence for the Knicks.
Kidd's arrest came within hours of the Knicks agreeing to a trade for fellow point guard Raymond Felton, raising the possibility they will refuse to match Lin's offer sheet with the Rockets.
Police said Kidd crashed his SUV into a telephone pole in the Hamptons on Sunday, days after signing with the Knicks.
Treated at a hospital for minor injuries after the crash, Kidd was arraigned on a misdemeanour driving-while-intoxicated charge and released without bail, Southampton Town police said.
Phone and email messages were left seeking comment from Kidd's agent. His attorney, Ed Burke Jr., said in a statement that Kidd was returning from a charity function before his accident, had pleaded not guilty to the DWI charge and was awaiting further court proceedings.
The Knicks, who signed the 10-time All-Star in free agency last week, had no immediate comment. Nor would they comment on their plans for Lin, even as speculation grew that Linsanity was headed elsewhere.
Kidd, 39, was alone in the 2010 Cadillac Escalade when it hit a pole and veered into the woods around 2 a.m. in Water Mill, police said. Water Mill is a serene, mainly residential community east of Southampton Village.
Kidd's next court date wasn't immediate available. The DWI charge carries the potential for up to a year in jail.
The Knicks signed Kidd away from the Dallas Mavericks in a deal that will pay him about $3 million a year. Kidd had played in New Jersey, leading the Nets to two NBA Finals appearances, before being traded to Dallas and remains fond of the New York City area, where his children continue to live.
The two-time Olympic gold medallist has been in trouble with the law before. While playing with Phoenix in 2001, he was arrested on a domestic violence charge, acknowledging he struck his former wife.
Kidd is second on the NBA's career lists for assists and steals. Coach Mike Woodson said Kidd, who helped the Mavericks win the 2011 NBA championship, would be a good tutor and backup for Lin, whom he said would open next season as the starting point guard.
Now he may not even be in New York.
The Knicks have repeatedly said they would match any offer for Lin, but the Rockets made it difficult with a three-year, $25 million deal that's worth about $15 million in the third year. New York has until 11:59 p.m. EDT on Tuesday to match the offer sheet for the restricted free agent.
Asked if he could envision Lin being with the Knicks next season, All-Star forward Carmelo Anthony said: "At this point there's a lot going on. I stay away from that part right now. I would love to see him back, but I think he has to do what's best for him right now."
Anthony, speaking before practice with the U.S. Olympic team, was then reminded it's up to the Knicks, not Lin, to decide whether he stays or goes.
"It's not up to me," Anthony said with a laugh. "It's up to the organization to say they want to match that ridiculous contract that's out there."
The Knicks wouldn't comment on their plans and never even confirmed whether they had received the offer sheet from Houston to start the three-day clock for matching the offer.
Felton played well in half a season for the Knicks before he was dealt to Denver in February 2011 as part of the package for Anthony. He struggled this season in Portland, briefing losing his starting job, but was considered an option for the Knicks if they couldn't land Steve Nash or Kidd to play with Lin.
Now it may be Kidd and Felton.
Jennifer Peltz in New York contributed to this report.