For an action in the past tense, it means the action stops at the current time. For example, "I lived in that house" means that I lived in the house sometime in the past and do not live in the house now.
I want to know if this holds for stative verbs like know. In other words, does "I knew him" means I came to know him sometime in the past, and I forget him now or have not seen or heard of him for a long time?
In its most likely meaning, I knew John Smith would imply that John Smith is now dead; see the numerous examples here.
As Jim said in the comments, if you want to avoid that implication, use I used to know John Smith.
You can also avoid that implication in other ways, e.g. by saying When I was in college, I knew a man called John Smith (see e.g. here). This makes no implication that John Smith is now dead, and it doesn't imply you've forgotten him. It does imply that you haven't had any information about him in a long while.
