This phrase is used in baseball to describe a bad out called when an umpire believes they saw a fielder tag out a runner on base. It is called a phantom tag because in reality, it never happened. This may occur if the umpire's view of the play is obstructed by the action or another player on the field. There is no recourse if an out is called on a phantom tag. Managers and players will usually complain if they catch it, but since instant reply is not used for this purpose, the call will always stand.
There was a famous phantom tag during the 1999 American League Championship Series. During Game 4, the Yankees' second baseman Chuck Knoblauch put a tag on the Red Sox' Jose Offerman and then completed the double play. When reviewing the replay closely, one can see that Knoblauch missed the tag. Although rare, phantom tags do continue to occur; as a result, Major League Baseball has explored the use of instant reply to review these instances as they occur.