This phrase refers to smoked herring. In many parts of 19th century Britain, such fish have a very strong smell and were usually known, not as kippers, but as red herrings. Because of their smell, they were good at masking other smells. As a result, they could easily cover the scent of a fox. A red herring pulled across the trail could divert the hounds onto a false path. Thus, by analogy, the phrase came to be used to describe any false trail.