I've ummed and ahhed about writing this, so please take with a bucketload of salt. I do not know anything about the situation or your brother bar the little info here. I am about to approach this in a completely leftfield way and may be utterly barking up the wrong tree... I am someone who has observed and experieced the workings of mental health and found it lacking, so, yeh....
Obviously your brother shouldn't be being abusive to your parents, and protecting them makes sense. However, regarding DB...
I'm wondering what his actual diagnosis is. You dont have to say, I'm just wondering whether they've said "paranoia", or is paranoia is an actual named symptom of something else, or whether he just appears paranoid and it is assumed to be part of his illness. I'm wondering this because it's hard to grasp the full range of his difficulties and what may be helpful/approach to take.
The fact that he's successfully appealed sections is also interesting. I suppose what I'm thinking is, suppose he's not massively paranoid, just a little and some of what he says is right? It's so easy to view people in the light of a diagnosis and forget the real person and experiences. But maybe he is acting odd (for want of a better word) because of the emotions and behavioural responses they provoke, as oppose to actually suffering some kind of psychosis. In which case being on a ward dosed up on anti-psychotics is going to be distressing and unhelpful. (Distressing for anyone tbh but for some may be helpful.) Those meds can have serious side effects... one can see that with emotions running high and being deprived of your liberty may well feel like, for example, people are trying to poision you and misunderstanding everything... which could be conveniently labelled paranoia and dosed with more meds...
As for "won't engage" heh that is their term, not yours, I think? It's a favourite... it means "won't engagae on OUR terms" which is slightly different.
I wonder what your brother would say if given the chance to explain his situation and illness from his viewpoint? And how he feels about MH treatment? I'm guessing he'd probably need encouraging away from ranting and more into a thoughtful descriptive thing... You may have already done this of course.
And then the law can be laid down, boundaries etc. regarding your parents. I cant help but wonder if, for your DB a more holistic approach away from the system might be helpful. Hobbies, days out etc.
I haven't a clue whether any of this is helpful, and I probably am sound mad
. I suppose I'm writing it just in case it's relevant, rather than thinking it necessarily is.
All the best 