This can happen for a couple of reason. Gas inside the cake can make its way out and get trapped inside a layer of fondant, which makes the fondant act like a balloon and inflate in a pocket. This can also happen with icing, which is what I was using in this case.
It also happens if the fondant is too long for the side of the cake, so that when it starts to settle it can sink below the bottom edge of the tier. It can end up being pushed out so that it looks like there's a ridge or a bulge. If you smooth the fondant down and trim it level with the cake board, that kind of cake tumor is easily fixed.
The inflating gas version is more difficult to handle, because the source of the escaping gas isn't always obvious, so it isn't always easy to eliminate. In this case, it was obviously coming from a soft cream cheese filling that had been compressed when the layers were combined and the cake was stacked.
|Just rip into it...You can fix it later.|
I also press down fairly hard on the layers once the tier is done. Some people weight the cakes down by putting something heavy on top of the cake after they've been filled, but before they're iced. The press-down will force air out, and will help get rid of trapped air.
If you have inflating fondant, take a sewing needle and poke it through the bubble. Gently press the fondant down and let the gas inside the tumor release out of it. Make sure that the hole is still open, because once gas starts to ooze out it will continue until it's all gone. If the cake is decorated in a way that you can do this, it isn't a bad idea to just make some tiny needle holes all over the cake to begin with, just in case. It's like poking holes in potato before you bake it so that it won't explode.
|The temporary release valve|
Leaving it alone will let the air out if more is going to escape. Once it looks like no more tumors are developing, you can put the cake into the fridge, let the icing harden up, then repair the hole.
I tend to get more cake tumors on any cake that has cream cheese filling than other types of fillings. I suspect that because the cream cheese is softer, I can't press down on the layers as hard as I can with other types of fillings, and that means that I more often leave air between the layers. If anyone has any suggestions for how to avoid this with the cream cheese let me know! Stupid cream cheese...