Li Finnegan is a doctor and the adoptive mother of John "Finn" Finnegan, who lives in Malibu, California. Li came to visit Finn and learned he was about to marry Steffy Forrester, the co-CEO of the Forrester Creations fashion dynasty; it was revealed that Li, along with her husband, Jack Finnegan, had adopted Finn. At Finn and Steffy's wedding, Li's world was rocked when Finn came in with a woman whom he introduced as the biological mother he had just met, Sheila Carter. Li was furious that Jack had known that Sheila was Finn's real mom because Sheila had approached Jack when Finn was a baby, but Li could barely believe it when the Forresters revealed that Sheila was a convicted criminal whose crimes included causing Steffy's mother, Taylor Hayes, to be presumed dead after Taylor and Sheila struggled over a gun.

Li believed it was best that Finn stay away from Sheila and was able to forgive Jack for keeping Sheila a secret. But Li couldn't forgive it when Jack eventually admitted that he was, in fact, Finn's biological father, and that he had adopted his own son to cover up an affair he had had with Sheila. Months later, Li arrived at the hospital without Jack after Finn was fatally shot in a robbery, which also left Steffy in critical condition; though Sheila begged Li to let her see Finn one last time, Li seethed that she was Finn's mother, not Sheila, and that she would take care of Finn as she always had.

Once Steffy recovered, Li was not surprised to learn that Sheila had been the one to shoot both her son and her daughter-in-law. Li refused to plan a memorial service for Finn; it was then revealed that Finn had registered a weak pulse in the ambulance after being pronounced dead at the scene, so doctor Li smuggled the unconscious Finn out of the hospital and hooked him up to machines in an apartment despite having been told Finn was as good as dead.

A smug Li visited Sheila in jail, unwittingly tipping Sheila off by referring to Finn in the present tense. When Sheila showed up on Li's door, Li tried to fool Sheila into thinking they could care for Finn together, but Li got caught trying to call the police. Li brawled with Sheila and escaped, but her SUV caught fire and crashed into a body of water when Sheila ran Li off the road. Traumatized and rendered mute, a disheveled Li turned up in an alley and was discovered by publishing magnate Bill Spencer. Li had total recall when Bill's son, Liam Spencer, came to visit and recognized Li; Li brought Bill to the apartment where Sheila was holding Finn and was left to guard the tied-up Sheila when Bill took Finn to Monte Carlo to reunite with Steffy. However, Li was knocked unconscious by Sheila's henchman, Mike Guthrie, which allowed Sheila to escape.

Grateful, Li visited Bill to thank him for coming to her aid and to reveal that the fugitive Sheila had been killed in a bear mauling. As Li and Bill discussed their failed relationships, Li learned that she and Bill had a lot in common. After Sheila was discovered alive, Li supported Finn and Steffy, who were being blackmailed by Bill into not testifying against Sheila; Li was later surprised to learn that Bill had only pretended to romance Sheila as part of a sting operation to send Sheila to jail for a long-ago murder. When Sheila was rushed into emergency having suffered a heart attack, Li told Finn they should let Sheila die and was dismayed when Finn resuscitated her.

Li taunted Sheila once she was returned to prison, but when Sheila was released on a technicality, Li warned Finn against allowing himself to develop familial feelings for her. Indeed, once Steffy left town because she was unnerved by Sheila's freedom, Li demanded that Finn "do something" about Sheila, hinting at a more permanent solution. Li found Sheila working at a restaurant, Il Giardino, and tried to goad Sheila into doing something illegal by smashing Sheila's face into a plate of pasta.

Elsewhere, Li discovered her niece, Luna Nozawa, working as a Forrester Creations intern and demanded that Luna leave, even when Luna's co-worker, R.J. Forrester, helped Luna stand up to Li. Privately, Li told Finn that she hated Luna's mother, Penelope "Poppy" Nozawa, because Li had gotten Poppy a job at the gift shop of the hospital where Li worked, only for Poppy to have an affair with a married doctor, which put Li's career at risk. Later, while chastising Poppy for her poor life choices, including apparently not knowing who Luna's father was, Li let it slip that she resented Poppy because Poppy could get pregnant, while it hadn't been possible for Li to. Li also looked back disdainfully at the year Poppy had stayed with her, Jack, and Finn, and discouraged Finn when he wanted to resume a relationship with his Aunt Poppy.