Dumping is usually only illegal for foreign companies to do. The government doesn't care about two domestic firms competing with each other, what they are worried about is the Chinese government using it's vast resources to subsidise the dumping of millions of almost-free tablet computers onto the US market and putting Apple out of business.

It is also illegal for a domestic company to price below cost, if that company is a monopoly. Under the anti-trust laws, this is known as abusive pricing.

However, it is legal for a non-monopoly to price below cost. The assumption is that this behavior is self-regulating, because the company will eventually go out of business if it can't make a profit.

If otherwise-viable competitors are driven out of business in the meantime, that's simply collateral damage. The current thinking about antitrust laws is that they should protect competition, not competitors. Eventually, new companies will spring from the nuclear wasteland. (Google Reader and RSS comes to mind.)