Is shunning the husband's brother and his wife—after the wife has been harmed by the brother's actions and interference in her life, and his wife fabricating lies about her—considered the forbidden severing of kin ties, or is that permissible in order to preserve the marital life?

The husband's brother is a non-mahram. Severing ties with him is not considered severing ties of kinship. In fact, it is forbidden to meet with him if there is a شرعي محذور (religious prohibition) involved, such as khalwa (private seclusion). If meeting his wife causes disruption to your marital life, then avoiding her and reducing visits to her is advisable. We advise you to encourage your husband to maintain ties with his brother and to visit his brother's wife, if possible, by engaging in beneficial activities. Do not rush into a decision that could ruin your relationship with your husband.